The Leveson Inquiry

culture, practices and ethics of the press

AN INQUIRY INTO THE CULTURE, PRACTICES AND ETHICS OF THE PRESS REPORT

The Right Honourable Lord Justice Leveson November 2012
4 volumes not to be sold separately Volume IV

AN INQUIRY INTO THE CULTURE, PRACTICES AND ETHICS OF THE PRESS
The Right Honourable Lord Justice Leveson November 2012 Volume IV

Presented to Parliament pursuant to Section 26 of the Inquiries Act 2005 Ordered by the House of Commons to be printed on 29 November 2012

HC 780-IV

London: The Stationery Office

£250.00 4 volumes not to be sold separately

© Crown copyright 2012 You may re-use this information (excluding logos) free of charge in any format or medium, under the terms of the Open Government Licence. To view this licence, visit http://www.nationalarchives.gov.uk/doc/open-government-licence/ or e-mail: psi@nationalarchives.gsi.gov.uk. Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned. Any enquiries regarding this publication should be sent to us at generalenquiries@levesoninquiry.org.uk This publication is available for download at www.official-documents.gov.uk ISBN: 9780102981063 Printed in the UK by The Stationery Office Limited on behalf of the Controller of Her Majesty’s Stationery Office ID P002525215 11/12 22930 19585

Printed on paper containing 75% recycled fibre content minimum.

Contents
Volume I
Page

PARt A: the InquIRy
Chapter 1: the Announcement
1 2 3 1 2 3 4 5 6 1 2 3 1 2 3 Introduction Role of the Assessors Visits Setting up and preliminaries The gathering and presentation of evidence Challenging the evidence Other material Submissions Engagement with the public: the website Rule 13 of the Inquiry Rules 2006: the approach Rule 13 of the Inquiry Rules 2006: the practice The nature and standard of proof Scope Purpose Timing and content

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Chapter 2: the approach

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10 19 31 35 36 37

Chapter 3: Further issues of law

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38 42 43

Chapter 4: the Report

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PARt B: the PRess And the PuBlIC InteRest
Chapter 1: Introduction Chapter 2: the freedom of the press and democracy
1 2 3 4 5 6 1 2 3 4 Context A brief history of press freedom in the United Kingdom The importance of a free press: free communication The importance of a free press: public debate and holding power to account Press freedom within the rule of law and the role of statute The protection of sources and other legal privileges of the press Context Freedom of expression Personal autonomy and civil liberties Other public goods
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55 56
56 58 61 63 65 68

Chapter 3: Competing public interests

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69 71 73 75

The Leveson Inquiry

Chapter 4: The responsibilities of the press
1 2 3 4 Context Press power and the impact on society Communication: truth, comment and ‘assessability’ Press ethics and the role of a code of ethics

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76 76 78 81

PARt C: the PRess
Chapter 1: Context
1 2 1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 1 2 3 4 Introduction Commercial pressure on the press Introduction News Corporation Associated Newspapers Ltd Northern and Shell Media Group Ltd Trinity Mirror plc The Telegraph Media Group The Guardian Media Group The Independent Group The Financial Times The regional press Magazines and periodicals Introduction Broadcasters The World Wide Web Blogs and other web-based commentary Social networking sites Other providers Enforcement Press photographers What is plurality and why does it matter? Approaches to securing plurality The history of media ownership rules in the UK from the 1990s History of the newspaper ownership regime

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Chapter 2: The press: history, governance structures and finances

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99 99 114 120 125 130 134 139 145 148 152

Chapter 3: Alternative news providers

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Chapter 4: Plurality

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Contents

PARt d: stAndARds
Chapter 1: The historical background
1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 Introduction The Royal Commission into the Press 1947 The Royal Commission of 1962 and the Younger Committee into privacy The Royal Commission of 1974 The first Report of Sir David Calcutt QC The second Report of Sir David Calcutt QC The death of Diana, Princess of Wales Conclusions Introduction The establishment of the PCC Current powers, operation and standards PressBoF Benefits of self-regulation Anti-harassment policy Complaints

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Chapter 2: Self-regulation of the press

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PARt e: CRossIng legAl BoundARIes: The CrImInAl And CIvIl lAw
Chapter 1: The legal framework Chapter 2: Police investigations start
1 2 1 2 3 4 5 6 1 2 3 4 5 6 Operation Reproof Operation Glade Introduction The genesis of Operation Motorman The search Prosecutions arising from Operation Motorman Publication of Parliamentary Reports in 2006 Conclusions Introduction The collection of evidence The prosecution strategy The outcome to the prosecution Subsequent operational decisions Police strategy for the aftermath

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Chapter 3: Operation motorman

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Chapter 4: Phone hacking: the expanding impact of Operation Caryatid

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The Leveson Inquiry

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The reaction of the News of the World July 2009: The Guardian September 2010: The New York Times December 2010: The Guardian article and the aftermath The past unravels Conclusions: the police and the CPS Police Inquiries: Operations Weeting, Elveden and Tuleta The Management and Standards Committee

337 350 401 408 412 425

Chapter 5: A new approach to the allegations

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421 424

Volume II
PARt F: the CultuRe, PRACtICes And ethICs oF the PRess: the PRess And the PuBlIC
Chapter 1: Introduction
1 2 3 4 1 2 1 2 3 1 2 3 4 5 6 7 1 2 3 4 Overview Module One and the Terms of Reference Evidence in Module One of the Inquiry The structure of Part F of the Report The value and virtues of the UK press Some case studies Overview The complaints The harm Introduction Influence on culture at the News of the World Attitude towards individuals Intrusion Investigative journalism Approach to compliance Credibility of witnesses Introduction The Dowlers Kate and Gerry McCann Christopher Jefferies

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Chapter 2: Good practice

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Chapter 3: Complaints of an unethical press

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Chapter 4: Some practices at the news of the world

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Chapter 5: some case studies

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Contents

5 6 7 8 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4

The Rt Hon Gordon Brown MP and his son’s illness Hugh Grant and ‘the mendacious smear’ Sebastian Bowles Recent events: Royal photographs Introduction Lack of respect for privacy and dignity Unlawful or unethical acquisition of private information Breach of confidence and misuse of confidential and/or sensitive information Harassment Intrusion into grief and shock Treatment of children Representation of women and minorities Inaccuracy Financial controls and payments for stories Treatment of critics Complaints handling Introduction Possible causes The relevance of the internet The press response to this Inquiry

564 572 576 579

Chapter 6: Criticisms of the culture, practices and ethics of the press

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592 593 610 640 645 655 658 660 673 694 704 709

Chapter 7: Conclusion

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PArT G: The PreSS And The POlICe: The relATIOnShIP
Chapter 1: Policing with Consent: the role of the press
1 2 3 1 2 3 1 2 3 4 5 6 Introduction The purpose of the relationship and public confidence Tensions in the relationship between the media and the police Metropolitan Police Service: the Commissioners Other police forces Press departments Introduction The use and abuse of information Entertainment: an overview The perception of influence The problems of friendship Calibrating the harm: the views of Commissioners

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Chapter 2: The history of the relationship: different Approaches

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Chapter 3: Press and the Police: the harm and the response

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The Leveson Inquiry

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The question of corruption Independent Police Complaints Commission (IPCC) HMIC report: ‘Without Fear or Favour’ Elizabeth Filkin’s review of the relationship between the MPs and the media Association of Chief Police Officers (ACPO) Introduction Tip offs Involvement of the press on operations Off-the-record briefings Leaks of information Gifts, hospitability and entertainment Media employment Corruption, whistleblowing and related matters Conclusion

933 943 948 960 966

Chapter 4: The press and the police: conclusions and recommendations

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980 983 984 985 987 988 990 991 994

Volume III
PArT h: The PreSS And dATA PrOTeCTIOn
Chapter 1: Introduction
1 2 1 2 3 4 5 1 2 3 4 5 1 2 3 Background The ICO: structure, governance and approach The investigation The ICO response: leadership The approach to the PCC What Price Privacy? The political campaign What Price Privacy? The reaction of the PCC and the editors Criminal proceedings in respect of journalists The use of regulatory powers Engagement with the industry: guidance and promoting good practice Engagement with victims Conclusions and the questions raised by Operation Motorman Introduction Personal information privacy and press practices Following up Operation Motorman

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Chapter 2: Operation motorman

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Chapter 3: Other possible regulatory options

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Chapter 4: the ICo and the press today

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Contents

4 5 1 2 1 2 3 4

Following up the political campaign Phone hacking and the ICO The current views of the ICO A different perspective on the legal framework “Too big for us?” The struggle for a profile: political campaigning and the power of the press Independent regulation of the press: lessons learned Powers, governance and capability of the ICO: reflections of the future

1058 1059

Chapter 5: Issues about the legal framework

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Chapter 6: The relationship: the ICO and the press

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Chapter 7: Summary of recommendations

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PARt I: the PRess And PolItICIAns
Chapter 1: Introduction Chapter 2: The Conservative years
1 2 1 2 3 4 5 1 2 3 4 1 2 3 4 5 1 2 Prime Minister Thatcher: 1979-1990 Prime Minister Major: 1990-1997 The 1992 general election The 1997 general election Prime Minister Blair: 1997-2007 Prime Minister Brown: 2007-2010 Political news management Introduction and background Mr Cameron’s relations with the press whilst Leader of the Opposition Prime Minister Cameron: 2010-present Reflections Purchase of The Times and The Sunday Times Response to the reports of Sir David Calcutt QC Human Rights Act 1998 Data Protection Act 1998 Communications Act 2003 Introduction The plurality test and quasi-judicial procedure

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Chapter 3: new labour

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Chapter 4: The Conservative revival and the coalition

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Chapter 5: Media policy: examples from recent history

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Chapter 6: media policy: The BSkyB bid

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The Leveson Inquiry

3 4 5 6 1 2 3 4 5 6 7 1 2 3 4 5

J une 2010 – December 2010: The Rt Hon Dr Vince Cable MP and the Department for Business, Innovation and Skills 21 December 2010: Dr Cable’s comments and the transfer of function D ecember 2010 – July 2011: The Rt Hon Jeremy Hunt and the Department for Culture, Media and Sport News Corp and the Rt Hon Alex Salmond MSP Introduction The Deputy Prime Minister, the Rt Hon Nick Clegg MP The Leader of the Opposition, the Rt Hon Ed Miliband MP The First Minister of Scotland, the Rt Hon Alex Salmond MSP The Rt Hon Kenneth Clarke QC MP The Rt Hon Michael Gove MP The Rt Hon George Osborne MP Introduction The proprietors ‘Too close’ a relationship Existing regulatory framework Recommendations for future relations between politicians and the press

1309 1335 1351 1407

Chapter 7: Further political perspectives on relationships with the press

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Chapter 8: Conclusions and recommendations

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Chapter 9: Plurality and media ownership: conclusions and recommendations
1 2 3 4 5 6 Introduction Scope Measuring plurality Limits and remedies What should trigger a review? Who should be responsible for the decisions?

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Volume IV
PARt J : AsPeCts oF RegulAtIon: the lAw And the PreSS COmPlAInTS COmmISSIOn
Chapter 1: Introduction Chapter 2: the criminal law
1 2 3 4 5 Introduction The investigation of crime: complaints to the police The Investigation of crime: gathering evidence A failure of policing Police resources

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1480 1482 1485 1486 1488

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Contents

6 7 8 9 1 2 3 4 5 6 1 2 3 4 5 6 7 8

Public interest: a defence to crime Public interest: the decision to prosecute Public interest: other safeguards in the criminal process The future Introduction Civil proceedings: the present risk of litigation Litigation against the press The substantive civil law Damages Costs Introduction What the PCC did well Independence from the industry The alignment with industry The PCC as regulator Structural problems with the PCC Investigatory failures Conclusions

1489 1491 1494 1496

Chapter 3: The civil law

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Chapter 4: The Press Complaints Commission and its effectiveness

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PARt K: RegulAtoRy Models FoR the FutuRe
Chapter 1: Criteria for a regulatory solution
1 2 3 4 5 6 7 1 2 3 4 5 6 7 8 Introduction Effectiveness Fairness and objectivity of standards Independence and transparency of enforcement and compliance Powers and remedies Cost Accountability Industry acceptance of the need for reform The proposal: overview Governance and structures Complaints Standards and compliance Potential for growth Funding The Code and the Code Committee

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Chapter 2: The self-regulatory model proposed by the PCC and PressBoF

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The Leveson Inquiry

9 10 1 2 3 4 5 6 7 8 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 1 2 3 1 2 3

The Industry Funding Body Incentives to membership Introduction Effectiveness Fairness and objectivity of standards Independence and transparency of enforcement and compliance Powers and remedies Cost Response of editors and proprietors to the PCC and PressBoF proposals Summary and conclusions Introduction A new regulatory body Functions and structures Should coverage be voluntary or mandatory? Incentives for membership Statutory recognition Statutory provision The Code Complaint handling Remedies and redress Sanctions Dispute resolution The role of the courts Costs and funding Protection and promotion of freedom of expression Protection of journalists The Press Council of Ireland and the Press Ombudsman Other models of press regulation: Europe and beyond Review of press regulation: Australia and New Zealand Introduction Regulatory options Regulatory tools

1610 1611

Chapter 3: Analysis of the model proposed by the PCC and PressBoF

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Chapter 4: Other proposals submitted to the Inquiry

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Chapter 5: International comparators

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Chapter 6: Techniques of regulation

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Contents

Chapter 7: Conclusions and recommendations for future regulation of the press
1 2 3 4 5 6 7 1 2 3 4 5 6 7 1 2 Introduction Options put forward A new system must include everyone Voluntary independent self-regulation Encouraging membership Giving effect to the incentives Summary of recommendations The issue The questions What standards should be complied with? What consequences should apply for breach? How should any consequences be applied? To whom should any provision apply? My views Introduction Recommendations to a new regulatory body

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Chapter 8: The alternatives

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Chapter 9: recommendations for a self-regulatory body

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PARt l: suMMARy oF ReCoMMendAtIons APPendICes
Appendix 1: Counsel to the Inquiry and the Inquiry Team Appendix 2: Submissions and correspondence statistics Appendix 3: Witnesses to the Inquiry Appendix 4: Legal materials Appendix 5: Evidence relevant to the generic conclusions on the relationship between politicians and the press: Part I, Chapter 8 Appendix 6: Bibliography

1801 1819
1821 1823 1827 1843 1955 1985

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chapTer 1 inTroducTion
1.1 This Part of the Report returns to the conduct of the press and provides the context in which the conduct of the press in any particular case can be challenged. A broad outline of the criminal and civil law in so far as it might impact on journalists is set out in Appendix 4 but the substantive law only goes so far. For the criminal law, it is important also to consider the practical difficulties which reduce the prospect of a criminal investigation being started, let alone continue to fruition and result in prosecution. Chapter 2 identifies the argument that has been advanced by some that the matters giving rise to this Inquiry are a consequence of a failure of criminal law enforcement rather than anything else, and outlines what I consider to represent the reality of modern policing and the investigation of crime. It deals with the circumstances in which criminal investigations are instigated and the issues that are likely to be faced in the gathering of evidence. The Chapter then goes on to analyse the role that acting in the public interest should play within the criminal law. This is first in relation to the decision to prosecute: after the issue was raised by the Inquiry, the Director of Public Prosecutions consulted on the topic and then issued a formal guideline. It also considers the way in which the public interest might impact on later aspects of the criminal process as a consequence of judicial management, the jury and (if a conviction is recorded) sentence. Possible changes for the future are then considered. These include the preparation of guidelines should the maximum sentence for offences under s55 of the Data Protection Act 1998 be increased along with the submissions made by the Deputy Commissioner of the Metropolitan Police in relation to the Police and Evidence Act 1984. Chapter 3 concerns the civil law. Here the focus is not on the substantive law but, rather, on the impact of different costs regimes on the civil justice system and, in particular, the consequences of proposed changes in the law surrounding funding that are likely substantially to affect litigation against the press. On the basis that the costs regime is about to change to the disadvantage of those wishing to pursue civil litigation with the benefit of a Conditional Fee Agreement (which has led to an increase in the award of general damages in personal injury litigation), damages for defamation, breach of privacy and other media torts also fall for review, as does the issue of aggravated and exemplary damages. The other procedural law issue discussed concerns the mechanism for introducing incentives in relation to the costs of litigation if a regulator provides a system of arbitration. Chapter 4 is different and does not look to the future. The Terms of Reference require the Inquiry to consider the extent to which the current regulatory framework has failed. That requires a detailed consideration of the operation of the Press Complaints Commission.

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Chapter 2 the Criminal law
1. Introduction
1.1 The criminal law can touch upon the work of journalists in many ways and inevitably prescribes the ways in which it is acceptable for stories to be obtained. A detailed summary of aspects of the criminal law most likely to be engaged in the pursuit of journalism is set out in Appendix 4 but it is not intended to be comprehensive: by way of example, aspects of the behaviour of Neville Thurlbeck as he pursued a follow up to his scoop relating to Max Mosley were described by Mr Justice Eady as containing “a clear threat to the women involved that unless they cooperated … (albeit in exchange for some money)”, making the point that it was “elementary that blackmail can be committed by the threat to do something which would not, in itself, be unlawful”.1 There is no doubt room for other potential offences to be engaged in the unprincipled pursuit of a story. On the basis that what was believed to have taken place at the News of the World (NoTW) (ignoring what might have happened elsewhere) consisted of the commission of crime, it has been suggested that this Inquiry is unnecessary, if not misconceived. It is argued that the problem, if such there was, did not lie with the press but with the police for their failure to investigate crime; furthermore, because of the existence of the criminal law, these issues simply do not require further attention in general or regulation in particular. Without attempting to list all of those who have developed the same argument, it is worth mentioning three different ways in which the point has been articulated. First, in one of the seminars prior to the commencement of the hearings during the course of an address concerned with defending free expression, Kelvin MacKenzie, the former editor of The Sun, said:2 “Yes there was criminal cancer at the News of The World. Yes there were editorial and senior management errors as the extent of the cancer began to be revealed. But why do we need an inquiry of this kind? There are plenty of laws to cover what went on. After all 16 people have already been arrested and my bet is that the number may well go to 30 once police officers are rounded up. Almost certainly they will face conspiracy laws, corruption laws, false accounting laws. There are plenty of laws that have been broken. Lord Leveson knows them all by heart. Supposing these arrests didn’t come from the newspaper business. Supposing they were baggage handlers at Heathrow nicking from luggage, or staff at Primark carrying out a VAT swindle, or more likely, a bunch or lawyers involved in a mortgage fraud would such an inquiry have ever been set up. Of course not.”

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paras 82 and 87, Mosley v News Group Newspapers Ltd [2008] EWHC QB 1777 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Kelvin-MacKenzie.pdf

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1.4

Ian Hislop, the Editor of Private Eye, put the matter in this way:3 “I do think that statutory regulation is not required, and most of the heinous crimes that came up and have made such a splash in front of this Inquiry have already been illegal. Contempt of court is illegal. Phone tapping is illegal. Taking money from – policemen taking money is illegal. All of these things don’t need a code. We already have laws for them. The fact that these laws were not rigorously enforced is, again, due to the behaviour of the police, the interaction of the police and News International, and – I mean, let’s be honest about this – the fact that our politicians have been very, very involved, in ways that I think are not sensible, with senior News International people ...”

1.5

Finally, the Rt Hon Michael Gove MP said exactly the same thing:4 “I have a prior belief that we should use the existing laws of the land and individuals and institutions should be judged fairly, on the basis of the existing laws of the land – ... and that the case for regulation needs to be made very strongly before we further curtail liberty. ... I think the best way of making sure that people obey the law is making sure that the police are appropriately resourced to investigate crime, that the courts hear the case for the prosecution and the defence and then, if someone is found guilty, that they face the consequences. I fear for liberty if those principles are eroded.”

1.6

The argument goes in this way. If a journalist intercepted a message on somebody else’s mobile telephone, without their permission, that journalist has committed a criminal offence and should be investigated and, if appropriate, prosecuted in exactly the same way as would occur if anybody else did the same thing. Journalists should be subject to the same law as everyone else but should not be subject to any additional regulatory restriction when all that each one is doing is exercising his or her right to free speech. A subsidiary argument (also advanced by a number of witnesses) goes further. Far from imposing additional regulation on the journalist, the importance of free speech and the obligation of the press to hold power to account should be recognised in the criminal law, so that, if a journalist is acting in the public interest in pursuing a story, he or she has a defence to any crime necessarily committed while doing so. The defence to a breach of s55 of the Data Protection Act 1998 (DPA), along with the unimplemented amendments contained within the ss77-78 of the Criminal Justice and Immigration Act 2008, is discussed later, but the argument is that no journalist should be in peril of conviction of crime while pursuing a story in the public interest (or, presumably, while pursuing a story that he or she perceives to be in the public interest). These arguments fail to recognise the way in which the criminal law operates and the practical limitations facing the police and prosecuting authorities, however enthusiastic their wish to detect all those committing criminal offences might be. The way in which Operation Motorman was pursued by the Information Commissioner and Operation Caryatid (later reconsidered on a number of occasions) by the Metropolitan Police Service (MPS) has been the subject of detailed analysis.5 At this stage, the intention is not to consider the specific investigations (although some aspects will be identified where relevant) but rather to examine the overarching constraints which face the police and the courts in the investigation, detection and prosecution of crime in general and crime involving journalists in particular.

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p9, line 8, Ian Hislop, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of-MorningHearing-18-January-2012.pdf 4 pp55-56, lines 7-14, Michael Gove, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-ofAfternoon-Hearing-29-May-2012.pdf 5 Part E, Chapter 4

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2. The investigation of crime: complaints to the police
2.1 Crimes come to be notified to the police and investigated in a number of different ways. First and most likely is that a complaint of crime or possible crime is made to the police. The victim of, say, a burglary or a robbery will contact the police and report the matter. Equally plausible is that the police will be notified in the event that the victim of, say, a shooting attends hospital. Alternatively, the police might themselves either be called to the scene of a crime (whether by a victim or witness) or they might be present and witness events for themselves (such as might occur during an occasion of public disorder). This report might be immediate and contemporaneous with events; it might follow after days (a burglary only detected when the householder returns home after holiday); after weeks or months (fraud); or even after many years (historic sexual abuse). Howsoever it occurs, the police will then take statements from witnesses and pursue such investigations as they can. An inquiry might involve scenes of crime officers, forensic scientists or other experts; it might involve the collection of documentary or other real evidence; it might involve the pursuit of information from those who might know who is responsible. Leads will be followed up and, in the most complex cases, a computer system such as HOLMES6 used to collate evidence and ensure that all appropriate avenues are explored. Second, for some criminal offences (and, in particular, for some of the most serious and those which do not generate victims likely to complain to the police), rather than wait for a possible victim, the police will target either an offence or a suspected offender. By way of example, large scale supply of Class A drugs may well be detected because of some intelligence leading to surveillance and the development of evidence in that way. Police resources may well be devoted to target serious criminal activity without waiting for the crime to be committed. In this type of case, however, again, evidence will be followed up, collated and researched in the same way. Whatever might have drawn the attention of the police either to the crime or the alleged criminal, many of the same investigative techniques will be deployed in order to bring those guilty of crime before the courts. Thus, during the course of an investigation for an indictable offence, a search warrant or search warrants can be obtained and the relevant evidence seized.7 Additionally, assuming reasonable grounds can be established that an indictable offence has been committed, a suspect may be arrested and, pursuant to s18 PACE, the police can search any premises occupied or controlled by that person both in relation to that offence and any other indictable offence connected with or similar to that offence. Once lawfully on premises being searched, the police can seize anything which the officer has reasonable grounds for believing has been obtained in consequence of the commission of an offence (to prevent it being lost damaged, altered or destroyed), along with anything which the officer has reasonable grounds for believing constitutes evidence in relation to an offence being investigated or any other offence.8 When it comes to journalistic material, there are very important restrictions to these powers which shall require detailed consideration but, for the present, it is sufficient to identify the possibility that these searches (and any interviews similarly conducted pursuant to powers in PACE) may reveal further evidence.

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Home Office Large Major Enquiry System s8 et seq of the Police and Criminal Evidence Act 1984 (PACE) 8 s19 PACE

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2.5

This very potted and non-exhaustive summary9 is important simply because it underlines the vital importance of what constitutes the trigger for a police investigation. In the first case, it was the complaint of the victim or other knowledge that a crime had been committed. In the second, it was the intelligence or suspicion that crime was in train. Something had to start the investigative ball rolling. Even for the least serious criminal offences, there has to be something. Speeding is now detected with the use of specific speed cameras; the use of a mobile telephone when driving, or failure to wear a seat belt, however, are only detected if someone (usually a police officer but, perhaps for some offences, a traffic warden) sees the offence being committed and does something about it. Turning to the offences which may be committed by journalists in pursuit of a story, the absence of a victim who is aware of the fact of the offence means that there will be no complaint. Neither can reliance be placed on the possibility that a complaint might be generated which will reveal what has been going on sufficiently to expose all such criminal wrongdoing. Both in Operation Motorman and Operation Caryatid, what was significant was not the original complaint (in the first case relating to the passing on of information from the DVLA and, in the second, relating to personal details concerning a member of the Royal Household of sufficient significance itself to cause a substantial police investigation to be undertaken). Rather, it was the entirely fortuitous discovery of a mountain of information in the form of the records kept by Steve Whittamore and Glenn Mulcaire respectively. Without those records, nobody would have been any the wiser about the extent to which Mr Whittamore was providing personal data in clear breach of s55 of the DPA and the subsequent exposures would never have seen the light of day. Without the many pages of Mr Mulcaire’s records, the fact that names, addresses, phone numbers, PIN details and other links had been gathered and recorded, the inference from all of which being that it could be alleged that there was wholesale and industrial interception of mobile telephone messages, would all have remained unrevealed. Even if the Guardian or the New York Times had managed to obtain sufficient information to enable the police to rely, without more, on the factual basis of the stories as published, the extent of what was going on would have remained hidden. The history of these particular investigations have been analysed at length but it would be truly remarkable if, because in each case of one specific complaint, the police had managed to identify the only private detectives indulging in this type of intrusion. The same is so, but even more so, in relation to the bribery of public officials. Putting the question of public interest to one side for a moment, there will be no complaint to the police about such conduct because it will be undetectable unless the public official is foolish enough to make some admission or leave some incriminating evidence around for someone else to see. The journalist will not reveal his or her source for a story (on which see below) and, irrespective of the likely public interest in the story (or, just as likely, the absence of any discernible public interest), it will be almost impossible to get to the bottom of it. Leak inquiries almost inevitably fail to achieve their purpose. Considerable emphasis was placed on the fact that the Information Commissioner has always made it clear that, since the reports What Price Privacy and What Price Privacy Now, he has not received complaints in relation to journalism; in relation to bribery, the present work of the MPS under the umbrella of Operation Elveden is also identified as demonstrating that this type of behaviour is also subject of rigorous police investigation. Neither of these facts, however, supports the wider propositions which are advanced.

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Appendix 4

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2.10

What is not acknowledged is the fact that absent evidence to point to the commission of an offence (which requires rather more than mere assertion before any report, let alone investigation, can be considered justifiable), nobody who has been the subject of intrusion will necessarily be aware of the circumstances in which information about them came to enter the public domain. At its highest will be a concern that someone has provided information to a journalist which has then been published but any attempt to identify from whom or how that material was obtained will fail on the basis that no journalist will reveal a source. Neither will anybody be aware that a particular story has been obtained because money changed hands with a public official. Again, reference has been made to the fact that Operation Elveden has led to a large number of arrests of journalists and, in addition, public officials, the inference being that this is simply a consequence of the police doing the work that they always could have done had they properly investigated the documentation that they had in their possession. That is not, however, the way in which Deputy Assistant Commissioner Akers put the matter. She said:10 “The Management and Standards Committee (MSC) is an independent body outside of NI and was formally established by News Corp on 21 July [2011]. ... In this role they respond to requests for information from the police which we consider are relevant to our inquiries. Our aim is to identify criminality. It is not to uncover legitimate sources and therefore the MSC responds in a manner that seeks to protect legitimate journalist sources at all times. They are also overseeing the searches being conducted of the 300 million emails produced by NI. ... The MSC’s role and remit is important to Operation Elveden as current legislation would make it difficult, if not impossible, for police to access material of the type it is seeking without that assistance. Where there is an evidential base to request information, the MSC have provided it in an unredacted format in order to enable police to identify the public official concerned. However, in relation to wider requests regarding the system by which alleged cash/cheque payments were made, the MSC provide information to police in a redacted form, i.e. with the names of the potential source redacted, until police are able to produce evidence that can justify identifying the source.”

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The same point was made during the course of her evidence in these terms:11 “Q. Now a general point which I think should be made is that have you been receiving assistance by the MSC, which, of course, is the independent review team within News International? A. The Management Standards Committee in News International. Yes, we have been receiving – we’ve got a co-operative working relationship with them, and they are the people who have passed us information upon which we’ve made arrests, as well as supplying information to us when we’ve made requests.” 12

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pp1-2, para 3 and pp3-4, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Second-WitnessStatement-of-DAC-Sue-Akers1.pdf 11 pp12-13, lines 24-8, Sue Akers, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-ofMorning-Hearing-6-February-2012.pdf 12 As I have made clear in Part E Chapter 5, there is an issue about the way in which the relationship between the Management and Standards Committee and the MPS has recently developed. I repeat that I am satisfied that it is not appropriate to elaborate further although the assistance upon which the police have had to depend only serves to make the point that this Chapter identifies

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It is not, perhaps, surprising that there has been considerable criticism of News International (NI) for providing such help to the police and, to put the matter colloquially, for “shopping” or “grassing” on their own employees. The contrary view is that the company has been very concerned to demonstrate that whatever has happened at the NoTW (or other titles under their control) has not only been without the authority of the most senior management of the company but also is entirely contrary to the principles on which the company operates. As a result, the company has done all that it can to assist the police where prima facie evidence of criminal behaviour has been identified. The words ‘prima facie’ are very important because NI has not conceded that criminal offences have been committed but only that police investigation is justifiable. Thus, the mere fact that there are lengthy investigations of phone hacking (Operation Weeting) and the bribery of public officials and others (Operation Elveden) is not evidence that it was and always has been open to the police to conduct the type of investigation now underway. Without the active cooperation of NI, it is clear that the extensive investigations would not have been possible: evidence of the earlier (different) approach is clear from what happened when the police sought to investigate in 2005 during Operation Caryatid which is outlined above.13 It must be emphasised that these points are not made to imply that there has been any breach by a journalist of the data protection legislation in the period since 2006 or, indeed, that the payment of public officials for stories provided in breach of their duty is necessarily more extensive than has been revealed or is suspected as a result of recent disclosures. Equally, however, the absence of complaint is little better than neutral and does not mean that steps should not be taken by newspaper organisations to put into place a regime that provides positive reassurance that the law is not being breached (save only in relation to data protection offences where the public interest justifies it). I am perfectly prepared to accept the evidence, for example, from Associated Newspapers Ltd, that as a result of a specific instruction from the editor-in-chief, no private detective has been engaged by the company since the publication of What Price Privacy Now, but this assertion to the Inquiry cannot take the place of a regular and verifiable audit. Putting complaint by a victim to the police to one side, the second approach to the detection of crime is similarly of little value in cases such as might arise in relation to the press. The fact is that it is almost inconceivable that the gathering of intelligence in a covert manner would be considered as either necessary or, in any event, appropriate. Not only is it unlikely that the criminality which could be revealed would be of sufficient gravity to justify such steps but, in addition, it is not clear how such information gathering could be undertaken.

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3. The investigation of crime: gathering evidence
3.1 Assuming that a complaint has been made to the police, the problems facing any investigator have only just begun not least because of the respect which the law accords to journalists, the fundamental rights of freedom of expression and a free press and the entirely legitimate responsibility of the press to hold power to account. Such is the significance of these important principles that very real safeguards are built into the law to provide protection. A detailed analysis of the powers and duties in respect of the search and seizure when that impacts on the work of journalists is set out in Appendix 4. It is sufficient to emphasise that material acquired or created for the purpose of journalism, held on a confidential basis by a

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person who acquired or created it for that purpose, constitutes excluded material pursuant to ss11(1) and 13 of PACE and other journalistic material constitutes special procedure material (see s14 of the Act). Search for such material is covered by the more restrictive provisions set out in Schedule 1 of the Act, which require the judge called upon to consider an application for production or a warrant to have regard the public interest; this is wide enough to include the importance of the impartiality and independence of the press, the potential stifling of public debate or other relevant factors.14 3.3 These protections are not, of course, designed to protect journalists from the consequences of their own deliberate criminality unconnected with the public interest, but the law certainly explains why DAC Akers expressed herself in the way in which she did in her evidence. One of the results of the legislation is that, in protecting what it is entirely appropriate to protect, there is a risk that behaviour which deserves no protection will not be uncovered. It makes it that much more difficult to obtain evidence to support (or, indeed, to undermine) a complaint, making much more remote the prospect of prosecution even where the true facts, if they were known, would demonstrate that such a prosecution was entirely merited. These difficulties both in relation to complaint and investigation only serve again to put the burden on journalists to respect the reasons for their freedoms and not to abuse that protection by invoking it to cover up that which cannot be justified. They also utterly undermine the case that all allegations of criminality can be left to the police to be investigated in exactly the same way that other allegations of crime are investigated. Thus, if there are these protections in law which, I accept, are entirely and fully justifiable, there must be some other way in which the press itself and the journalists who work within it can be held to account in relation to their own conduct.

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4. A failure of policing
4.1 Against this background it is necessary to consider the wider point that this Inquiry should examine the failure of the police to investigate phone hacking, rather than the activities of the press. The argument is that the Mulcaire notes were available to the police for them fully to investigate yet, for years, they did nothing. The detailed discussion of Operation Caryatid appears above15 but this question must be considered not just in the context of that case but as a systemic issue concerned with the balance between what conduct should fall only to those responsible for law enforcement and what conduct should be of concern of any business (and its employees) as to the way in which it goes about what it does. This has to be considered both at an individual but also a corporate level. A number of witnesses were asked whether, at an individual level, the suggestion that all that had transpired was a failure of policing might seem like blaming the police for their failure to stop motorists speeding, rather than the motorist for speeding in the first place. It is certainly unarguable that there are no small number of offences that are committed when it is believed by their perpetrators that they will not be detected and, in the most part, they are not detected. Perhaps not surprisingly, cars slow down when approaching speed cameras and speed up after the risk of being caught is passed. Few can drive or walk on the streets without seeing drivers use mobile telephones notwithstanding the prohibition on doing so. These are, however, individual offences committed by individuals: there is no mechanism to encourage or exhort those individuals to obey the law, other than the risk that an offence will be detected and the offender pursued.

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R v. Bristol Crown Court, ex parte Bristol Press and Picture Agency Ltd [1986] 85 Cr App R 190 per Glidewell LJ at 196 and R v. Central Criminal Court ex parte Bright and others [2001] 1 WLR 662 per Judge LJ (as he then was) at p679 15 Part E Chapter 4

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4.3

That is not to say that procedures cannot be put into place that allow the extent to which individuals are complying with the law to be monitored. Pursuing the motoring analogy (without in any sense suggesting that there is an equivalence between motoring offences and the type of offending with which the Inquiry has been concerned or, indeed, between the privilege of being able to drive and the right to free expression), such measures are required in connection with the use of certain types of heavy goods vehicles. In one sense, the driver of a heavy goods vehicle is individually responsible for observing the speed limits, rest regulations and other obligations placed upon him for reasons of general road safety. Breaching those regulations constitutes an offence but it would obviously seldom realistically be possible for the authorities to follow a driver to ensure compliance. By requiring every such vehicle to be fitted with a tachograph, however, compliance can be monitored and a check made to discover whether the driver is, in fact, complying with his legal obligations.16 It is possible to pursue this analogy a little further by considering the corporate level. Although employers may have difficulty monitoring the way in which their employees drive company cars not required to have a tachograph, the requirement on employers to ensure that heavy goods vehicles are fitted with a tachograph and that the appropriate records for each vehicle are maintained allows a system of audit for the employer to check on drivers and for the authorities to check on employers. A rogue driver, regularly breaching the regulations, should be discovered; if he is not and, even more so, if there are many such rogue drivers within one organisation, conclusions as to the cultural approach to road safety within that organisation can legitimately be drawn. Moving away from road traffic, it is commonplace for organisations with regulatory obligations to put into place compliance mechanisms intended to promote (if not ensure) proper practice.17 Equally, compliance is encouraged by an organisation if its culture, or the law, requires self-reporting to the regulator in the event that a breach is discovered.18 This approach does no more than reflect that the police (or a regulator) cannot be everywhere all the time and will not be well placed to detect impropriety which is likely to remain hidden, particularly when there is no complainant and, thus, no complaint. For the press, of course, there is no such regulatory regime and there is no suggestion that there should be. But the problem remains: what can be done to ensure that the law (and, perhaps, an ethical code) is treated with respect by all and that a culture is maintained to the effect that short cuts to obtaining a good story must not involve conduct which responsible journalists would consider reprehensible? If any journalist truly believes that almost anything goes in pursuit of a story, and that the basis for that story will be protected by the newspaper concerned as a journalistic source which will never be revealed, and, furthermore, this approach works, it is not surprising if a culture to that effect develops and the police will simply never be involved. This culture can, however, be avoided if the editor and newspaper

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16

EC Regulation 561/2006 on drivers’ hours and tachographs (together with regulations 3820/85, 3821/85, 3314/90, 3688/92, 2479/95, read with the regulations relating to driver’s hours and recording equipment , in particular SI 2006/1117, SI 2007/1819 and Part VI of the Transport Act 1968 as amended 17 For example, the majority of organisations operating as financial services markets, exchanges and firms which are regulated by the Financial Services Authority, and firms defined as the regulated sector under the Proceeds of Crime Act 2002 commonly have compliance departments 18 For example, note the self-reporting and notification requirements imposed and encouraged by the Solicitors Regulatory Authority in relation to the conduct of solicitors. See also the legal obligation imposed on banks and other financial services firms to report suspicious activity in the context of money laundering and terrorist financing to the Serious Organised Crime Agency if they know or suspect, or have reasonable grounds to know or suspect, that another individual or person is engaged in money laundering; and the information came to them in the course of their business in the regulated sector. It is an offence for an individual working in the regulated sector not to report to their ‘Nominated Officer’ or SOCA if the conditions for reporting have been met. The Proceeds of Crime Act 2002 also makes it an offence for a nominated officer not to disclose to SOCA if the conditions for reporting have been met (see sections 330 and 331)

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insist on a record (capable of being audited by someone should problems arise) which ensures that decisions are made about the ways in which certain types of stories are obtained by reference to identifiable principles and at an appropriate level within the news room. The issue of robust internal governance and the value which might be obtained from such an approach is further discussed in connection with the approach of the civil law analysed below.19 4.6 Whether or not there was a failure in policing does not impact on the culture, practices and ethics of the press, save only to the extent that anyone might have thought that the absence of complaint might have encouraged an atmosphere in which less attention was paid to the legality of what was being done than should have been. To put the same point another way, the question that must be addressed is whether there was a feeling of impunity within newsrooms generally or one or more specific newsrooms in particular.

5. Police resources
5.1 There is a further problem in seeking to cast responsibility for the overall present state of affairs on the police on the basis that there has simply been a failure of law enforcement. The approach, so far, has proceeded on the basis that police manpower resources are limitless and that if there is a complaint which is sufficiently based in provable fact to justify investigation, that investigation will be undertaken. The safeguards in the Police and Criminal Evidence Act (PACE) 1984 designed to protect journalistic material will be respected and the matter pursued, whether or not that will permit sufficient evidence to be disclosed to convert a complaint into a case which can be put before a prosecutor with sufficient prospect of success to justify commencement of a prosecution. In fact, superimposed on the limitations based upon the unlikelihood of there being a complaint, and the potential legal and other problems that an investigation will have to address, is the fact that police investigative resources are by no means limitless and work has to be prioritised in relation to every aspect of policing. It is therefore inevitable that a decision will have to be taken at an early stage whether the public interest sufficiently requires resources for this type of investigation, perhaps at the expense of investigating other criminal activity or undertaking other types of police work. In that regard, it is not sufficient to point to the activities of the MPS since January 2011, when for understandable reasons concerned with their reputation and, in addition, the Crown Prosecution Service, very considerable resources have been devoted to all the evidence initially available from the search of the home of Mulcaire and now supplemented by material from the Management and Standards Committee at News International. The circumstances of these investigations and the prior history is analysed at length20 but these are exceptional. The truth is that in relation to individual specific complaints, the complexity of any investigation, the likely attitude of the relevant newspaper to the provision of evidence and the difficulty of securing sufficient evidence potentially to satisfy the very high burden cast upon prosecutors will almost inevitably mean that a conclusion will be reached that resources are better devoted to other, and arguably more serious, complaints of crime.

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More than a few witnesses made it clear that the police were simply not interested in pursuing complaints when made. By way of example, Sheryl Gascoigne21 and Sienna Miller22 explained to the Inquiry that complaints about being pursued by the press were not investigated or taken further. In one sense, Mr Gove was absolutely right; the police should be appropriately resourced to investigate crime; unfortunately, until resourced to investigate every complaint while, at the same time, carrying on the very many other duties cast upon the police, priorities will be inevitable. The fact that certain crimes (if crimes they ultimately turn out to be) will be considered a low priority, perhaps because of the inherent risks and complexity in undertaking an investigation into them, (or the very limited prospects that an investigation will be successful) does not, or should not, impact on the propriety or justifiability of them being committed.

6. Public interest: a defence to crime
6.1 The analysis of the criminal law reveals that the only offence in respect of which there is a specific defence in law is that contained within s55 of the DPA (namely whether, objectively, the obtaining, disclosing or procuring of personal data was justified as being in the public interest which concept is undefined). As part of the legislative proposal contained within s77-78 of the Criminal Justice and Immigration Act 2008, not yet in force, an increase in the maximum penalty for breach of s55 of the DPA sits alongside a new defence which covers the position where a person acts for special purposes (including journalism) with a view to the publication of journalistic material in the reasonable belief (subjectively held by the journalist) that the obtaining, disclosing or procuring of the data with a view to publication was in the public interest. It has been suggested that, far from extending the way in which the criminal law operates to protect victims of journalistic practices that all who have appeared before the Inquiry have condemned, the reach of the criminal law should be reduced by importing a defence to all crime that was committed by a journalist acting in the public interest.23 The example most often given is the story published initially by the Daily Telegraph, which exposed the way in which the expenses system for Members of Parliament had been abused and, in particular, the fact that the Daily Telegraph paid a large sum of money to someone for a disc of all MPs’ expenses which, it is said, must have been provided, at the very least, in breach of confidence. The evidence of the then editor, Will Lewis, was that advice was sought at every stage and very great care was taken to ensure that what the Daily Telegraph did was not in breach of the criminal law24 but I recognise that, were that situation to recur today, questions about breach

6.2

21

pp71-71, lines 8-3, Sheryl Gascoigne, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-ofMorning-Hearing-23-November-20111.pdf 22 pp11-12, lines 15-17, Sienna Miller, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-ofMorning-Hearing-24-November-2011.pdf 23 The majority of the press core participants have argued in favour of a public interest defence for journalists, see for example News International closing submissions at para 64, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Closing-Submission-from-News-International.pdf, Associated Newspapers closing submissions at para 31 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-Submission-from-AssociatedNewspapers-Ltd.pdf, Guardian News closing submissions at para 17 http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Closing-Submission-from-Guardian-News-and-Media-Ltd.pdf. See also part 5, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf; Part 6, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-Roy-Greenslade-of-City-University.pdf which support a general public interest defence for journalists 24 pp56-57, lines 21-6, Will Lewis, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofAfternoon-Hearing-10-January-2012.pdf; para 31.3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/ Witness-Statement-of-William-Lewis.pdf

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of the Bribery Act 2010 could be more difficult to resolve. A more recent example related to the bribery of a court official to remove driving offences from the court record which was exposed in The Sun.25 6.3 The argument is that no journalist should be put in peril of being guilty of crime when he or she is pursuing a story, the publication of which will be in the public interest. The vital significance of the role of the press in holding power to account (and by publishing stories that uncover misconduct about which the public is entitled to know) can only be encouraged by complete protection from the risk of criminal prosecution; there is otherwise insufficient protection for such a journalist who should not have to weigh up the personal risk of criminal prosecution when deciding whether or not to proceed. The importance of the principle is further underlined by the fact that journalists have been prepared to take that risk (particularly in relation to the unwillingness to disclose sources) and that their position has been reflected and recognised (albeit couched with an appropriate exception) by Article 10 of the ECHR in terms that: “No court may require a person to disclose nor is any person guilty of contempt of court for refusing to disclose the source of information contained in a publication for which he is responsible unless it be established to the satisfaction of the court that disclosure is necessary in the interests of justice, or national security or for the prevention of disorder or crime.” 6.4 This suggestion is far from being a simple extension of the present or proposed defence to a contravention of s55 of the DPA. Given the different ways (representing different points in the chronology) in which such an offence can be committed, to be effective, the test would have to be satisfied at each stage. Thus, using the present law, it might be possible to procure or obtain personal data on the basis that there is an objectively justifiable basis for concluding that to do so is in the public interest. Disclosing that personal data raises potentially different issues. Take as an example the possibility that a journalist has information that there is a link between a public official (whose private life is of no public interest) and an exposed corrupt agent and that the latter is improperly influencing the former in the performance of his duties. The journalist deceptively obtains details of the telephone records of the public official, discovers that there is no such link but that it is obvious that the public official is having an extra-marital affair. There may be a public interest defence in procuring or obtaining the data in the first place but there is hardly any public interest in then disclosing what has, in fact, been discovered (as opposed to what it was thought, in fact wrongly, might have been discovered). Other criminal offences, however, are not based around the protection of data but rather bite at the moment of commission. Assume the same example as above but that the only way to obtain the evidence of a connection was by bribing (or blackmailing) an employee to provide the information, and that doing so produced not the evidence of a corrupt relationship but evidence of the extra-marital affair. With that evidence obtained, subject to potential arguments of privacy in the civil law (which an editor may well be prepared to argue), there would be nothing to prevent the journalist from publishing the story of the affair. On the face of it, many journalists might argue that this is entirely justifiable. A story (albeit not the story sought) has been lawfully obtained and there is no reason based upon its manner of acquisition why it should not be put into the public domain. What it depends on, however, is the information of a link between the official and the corrupt agent. Assuming that the story emerged, how could the proposed defence to an allegation of bribery or blackmail

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Details contained in the judgment of the Court of Appeal [2012] EWCA Crim 1243

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ever be tested? The journalist will say (whether honestly or not) that the information came from a reliable source, responsible in the past for much entirely accurate material, whom he is not prepared to name under any circumstances. The effect of a defence in law will be to emasculate almost all prospect of bringing a journalist to task for the way in which a story has been researched, whatever means, at first blush illegal, might have been used. 6.7 Neither is a criminal defence necessary. It might be thought that it is only right that both editors and journalists should think long and hard before embarking on what is criminal conduct in an effort to pursue a story and that it should not be sufficient to rely on an undisclosed source or sources as an all embracing defence. There are, however, other mechanisms to ensure that the law is not brought to bear on journalists (or, indeed, on any one else) in an oppressive or unfair way.

7. Public interest: the decision to prosecute
7.1 There are a number of mechanisms in place to prevent or inhibit the prosecution of crime which might be described (in non-technical language) as abusive. These revolve around the decision of the prosecutor to prosecute; the control that any criminal court exercises over abuse of its process; the ‘rights’ of the jury; and the ultimate discretion of a sentencing judge. It is worth discussing each of these in turn. Whatever might have been the position previously, in recent times the decision of the prosecutor to prosecute has always involved the exercise of discretion. On 29 January 1951, the then Attorney General, Sir Hartley Shawcross QC, made a statement to the House of Commons which has been frequently since repeated and adopted by subsequent Attorneys General. He said:26 “It has never been the rule in this country – I hope it never will be – that suspected criminal offences must automatically be the subject of prosecution.” 7.3 Until this Inquiry, the manifestation of this discretion was only contained within the Code for Crown Prosecutors, which not only prescribes an evidential test (whether there is sufficient evidence to provide a realistic prospect of conviction against each suspect on each charge) but also a public interest test which is articulated in this way:27 “A prosecution will usually take place unless the prosecutor is sure that there are public interest factors tending against prosecution which outweigh those tending in favour, or unless the prosecutor is satisfied that the public interest may be properly served, in the first instance, by offering the offender the opportunity to have the matter dealt with by an out-of-court disposal (see section 7). The more serious the offence or the offender’s record of criminal behaviour, the more likely it is that a prosecution will be required in the public interest. Assessing the public interest is not simply a matter of adding up the number of factors on each side and seeing which side has the greater number. Each case must be considered on its own facts and on its own merits. Prosecutors must decide the importance of each public interest factor in the circumstances of each case and go on to make an overall assessment. It is quite possible that one factor alone may outweigh a number of other factors which tend in the opposite direction. Although
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there may be public interest factors tending against prosecution in a particular case, prosecutors should consider whether nonetheless a prosecution should go ahead and for those factors to be put to the court for consideration when sentence is passed.” 7.4 Not least because of the expressed concern relating to journalists, the Inquiry raised the issue with the Director of Public Prosecutions, Keir Starmer QC (DPP) and, seeking an analysis of the position, also invited him to consider whether it was appropriate to enunciate a policy in relation to the public interest in the prosecution of journalists.28 His statement recognised the considerable public concern about the allegedly criminal activities of some journalists and saw no difficulty in developing a bespoke policy to give guidance to staff as to the approach to such difficult cases. Thereafter, on 18 April 2012, he published interim guidelines (on which he commenced a consultation exercise) on assessing the public interest in cases affecting the media. He distinguished between the public interest served by freedom of expression and the right to receive and impart information and the separate question of whether a prosecution is in the public interest (being the second stage of the Code test). That process of consultation concluded and, on 13 September 2012, the DPP issued formal Guidelines.29 Having reviewed the general principles relating to prosecution, the Guidelines refer to principles of special application in cases affecting the media by reference to Article 10 of the ECHR and decisions such as Sunday Times v UK (No 2)30 in addition to the further guidance to be derived from R v Shayler31 and AG’s Reference No 3 of 2003.32 The Guidelines then identify that the appropriate approach is encapsulated by the question whether the public interest served by the conduct in question outweighs the overall criminality. There is then an outline of the way in which prosecutors should deal with the question by following a three stage process: that is to say (1) assessing the public interest served by the conduct in question; (2) assessing the overall criminality; and (3) weighing these two considerations. In relation to the public interest served by freedom of expression and the right to receive and impart information (not previously defined in law), examples of conduct capable of serving the public interest are provided which are not intended to be exhaustive but which include the following: “(a) Conduct which is capable of disclosing that a criminal offence has been committed, is being committed, or is likely to be committed. (b) Conduct which is capable of disclosing that a person has failed, is failing, or is likely to fail to comply with any legal obligation to which s/he is subject. (c) Conduct which is capable of disclosing that a miscarriage of justice has occurred, is occurring or is likely to occur. (d) Conduct which is capable of raising or contributing to an important matter of public debate (of which there is no exhaustive definition but examples include public debate about serious impropriety, significant unethical conduct and significant incompetence which affects the public).

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(e) Conduct which is capable of disclosing that anything falling within any one of the above is being, or is likely to be, deliberately concealed.”
p23, lines 2-17, Keir Starmer QC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-ofAfternoon-Hearing-8-February-2012.pdf 29 http://www.cps.gov.uk/legal/d_to_g/guidance_for_prosecutors_on_assessing_the_public_interest_in_cases_ affecting_the_media_/ 30 [1992] 14 EHRR 123 31 [2002] UKHL 11 32 [2004] EWCA Crim 868

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7.7

As to the assessment of overall criminality, the Guidelines require prosecutors to focus on the conduct in question, the extent of the wrong-doing and the harm caused. They gave as non-exhaustive examples: “(a) The impact on the victim(s) of the conduct in question, including the consequences for the victim(s). (b) Whether the victim was under 18 or in a vulnerable position. (c) The overall loss and damage caused by the conduct in question (d) Whether the conduct was part of a repeated or routine pattern of behaviour of likely to continue. (e) Whether there was any element of corruption in the conduct in question. (f) Whether the conduct in question included the use of threats, harassment or intimidation. (g) The impact on any course of justice, for example whether a criminal investigation or proceedings may have been put in jeopardy. (h) The motivation of the suspect insofar as it can be ascertained (examples might range from malice or financial gain at one extreme to a belief that the conduct would be in the public interest at the other taking into account the information available to the suspect at the time). (i) Whether the public interest in question could equally well have been served by some lawful means having regard to all the circumstances in the particular case.”

7.8

The Guidelines go on to make the point that the impact on the victim(s) of the conduct in question is of considerable importance33 and the fact that invasions of privacy can be keenly felt and can cause considerable distress to victims (although “regard must be given to the level of the seriousness of the invasion, whether on the facts there was a reasonable expectation of privacy and whether the conduct in question was proportionate to the public interest claimed to be served”). As for the decision, the Guidelines go on to make two further, very important, points. These are: “37. Prosecutors are reminded that assessing whether a prosecution is required in the public interest is not an arithmetical exercise involving the addition of the number of factors on each side and then making a decision according to which side has the greater number. Rather, each case must be considered on its own facts and its own merits. It is quite possible that one factor alone may outweigh a number of other factors which tend in the opposite direction. Even where there may be a number of public interest factors which tend against prosecution in a particular case, the prosecutor should consider whether the case should go ahead but with those factors being drawn to the court’s attention so that they can be duly considered by the court. 38. Prosecutors should take special care in cases which involve the disclosure of journalists’ sources. In approaching such cases, prosecutors are reminded that the European Court of Human Rights has indicated that: 34 “Protection of journalistic sources is one of the basic conditions of press freedom … Without such protection, sources may be deterred from assisting the press in informing the public on matters of public interest. As a result the vital public

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Reference is made to Article 8 of the ECHR Goodwin v UK (1996) 22 EHRR 123 paragraph 39; see also Ashworth Hospital Authority v MGN Ltd [2002] 1 WLR 2003 and Mersey Care NHS Trust v Ackroyd [2007] EWCA Civ 101

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watchdog role of the press may be undermined and the ability of the press to provide accurate and reliable information may be adversely affected. Having regard to the importance of the protection of journalistic sources for press freedom in a democratic society and the potentially chilling effect of an order of source disclosure has on the exercise of that freedom, such a measure cannot be compatible with Article 10 of the Convention unless it is justified by an overriding requirement in the public interest.” 7.9 When the DPP was giving evidence, it was made clear that it was not for me or for the Inquiry to enunciate a prosecutions policy and, further, that it was a matter for him to determine whether or not he wished to.35 However, it is clearly important that he has chosen to accept the invitation proffered to him and now gone so far, after consultation, as to issue formal and thus definitive Guidelines. It is right to pay tribute to this contribution to the criminal justice system, which provides clarity to the circumstances in which a prosecution might be considered appropriate (and would obviously have excluded any prosecution should one have been considered in relation to the disclosure of MPs’ expenses). It is beyond doubt that journalists would prefer guarantees and immunity but, put simply, that would be unjustified and would do nothing to ensure that appropriate standards of behaviour were set, encouraged, supported and enforced, not merely as a matter of criminal law but also editorial practice.

7.10

8. Public interest: other safeguards in the criminal process
8.1 Three other protective mechanisms are available for journalists, each of which can be described shortly. First, although the court has no jurisdiction to interfere with the exercise by the prosecution of its discretion to prosecute,36 it can offer advice to the prosecutor and require instructions to be taken from the prosecuting authority before permitting the prosecution to commence. Furthermore, the court can stay a prosecution as an abuse of the process of the court, either because it represents an abuse of executive power37 or in circumstances which amounted to an ‘affront to the public conscience’;38 ‘so great an affront to the integrity of the justice system and therefore the rule of law that the associated prosecution was thereby rendered abusive and ought not to be countenanced by the court’ is also sufficient.39 It is not necessary to seek to define how these principles might be applied to the prosecution of a journalist; given the proposed guidelines on prosecution, it is extremely unlikely they will ever arise, but there should be little doubt that the circumstances will be obvious if they did. The second protective mechanism must be mentioned as a matter of constitutional reality. There are examples, littered throughout history, in which juries are properly directed as to the law and, in particular, the ingredients of a specific offence, who then take the view that, irrespective of the law, they are not prepared to convict for what they perceive to be good reasons. The best (and oft-cited) example is the acquittal of Clive Ponting, a senior civil servant, of offences contrary to s2 of the Official Secrets Act 1911, following his disclosure to Tam Dalyell MP of documents relating to the sinking of the General Belgrano during the

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p23, line 13, Keir Starmer QC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-ofAfternoon-Hearing-8-February-2012.pdf 36 See R v. FB, R v. AB, R v. JC [2010] EWCA Crim 1857 and the cases therein cited and R v. SH [2010] EWCA Crim 1931 37 See, for example, R v. Horseferry Road Magistrates’ Court ex parte Bennett [1994] 1 AC 42, R v. Mullen [2000] QB 520 38 Per Lord Steyn in R v. Latif [1996] 1 WLR 104 at page 112 39 See R v. Grant [2006] QB 60 per Laws LJ at para 54

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Falklands War in 1982. No reliance could be placed on the prospect of a jury taking this course in relation to a journalist but no analysis of the position would be accurate without it being mentioned. 8.3 The third protective mechanism is, in one sense, the ultimate safeguard. Although (in the absence of abuse of process) the court cannot prevent a prosecution from being pursued and will conduct the trial entirely in accordance with the law, should a journalist be convicted, a very substantial discretion vests in the judge when it comes to sentence.40 Even in those cases governed by guidelines issued by the Sentencing Council (which every court ‘must follow’), the ultimate discretion is preserved by the words ‘unless the court is satisfied that it would be contrary to the interests of justice to do so’: see s125(1) of the Coroners and Justice Act 2009. Thus, if a prosecution has been pursued which the judge concludes did not correctly balance the extent to which the public interest served by the conduct in question outweighed the overall criminality, it is open to him or her to reflect that fact in the sentence passed. At one end of the spectrum is an order of absolute discharge, prescribed by s12(1) of the Powers of Criminal Courts (Sentencing) Act 2000 in these terms: “Where a court is of the opinion, having regard to the circumstances including the nature of the offence and the character of the offender, that it is inexpedient to inflict punishment, the court may make an order discharging him absolutely.” 8.5 The effect of such an order is that the conviction is “deemed not to be a conviction for any purpose other than the purposes of the proceedings in which the order is made” and “shall be disregarded for the purposes of any enactment which imposes … or requires the imposition of any … disqualification or disability” on the convicted person: see s14(1) and (3) of the 2000 Act. The argument that has been advanced is that, by this stage, the journalist has had to undergo the indignity of prosecution and trial and that the decision of the judge that it is inexpedient to inflict punishment, doubtless because of the view that the judge takes of the prosecution, is of little comfort. This is a form of special pleading. The fact is that the journalist will have chosen deliberately to break the law in pursuit of a story. That should not be an everyday occurrence and it should be common place that no such decision is taken without the authority of the newspaper which employs him or her and then only following a careful consideration of the material that justifies it. If the journalist is freelance, it will be extremely wise for any such decision to be documented and the evidence base for it made clear. In those circumstances, the decision of an independent prosecutor should not be feared or considered an unnecessary interference with the freedom of the press: it is a check on the exercise of that freedom which ensures that it is not being abused. There are then potential checks on the prosecutor’s decision, ultimately, by the court should a prosecution ensue and reach the stage of sentence. Provided appropriate attention is paid to the importance of a free press and the duty of the press to hold power to account, there is no reason why journalists should not be subject to exactly the same checks and balances that every other member of society has to endure should they seek to exercise some right or privilege.

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The exception is, of course, where the penalty is fixed by law: effectively, this only applies in relation to murder

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9. The future
9.1 In the circumstances, save in relation to the modification of the defence and the increase in the maximum penalty for an offence under s55 of the Data Protection Act 1988 (which requires an order from the Secretary of State implementing the provisions of s77-78 of the Criminal Justice and Immigration Act 2008),41 I do not recommend that any change is necessary to the substantive criminal law. On the basis that the provisions of s77-78 of the Criminal Justice and Immigration Act 2008 are brought into effect, so that increased sentencing powers are available for breaches of s55 of the Data Protection Act 1998, I also recommend that the Secretary of State for Justice use the power vested in him by s124(1)(a)(i) of the Coroners and Justice Act 2009 to invite the Sentencing Council of England and Wales to prepare guidelines in relation to data protection offences (including computer misuse). With the new statutory maximum and the lack of precedent, it is important that courts recognise the gravity of this type of offending and are also provided with guidance regarding the implications should circumstances arise when it becomes necessary to consider the commission of this type of offence by a journalist. 9.2 The value of involving the Sentencing Council is obvious. Before producing a guideline, the Council is required to consult on a draft and include within that consultation process “such other persons as the Council considers appropriate”:42 only then is a guideline promulgated. It is inconceivable that the Council would not consider it appropriate to consult the Information Commissioner, the media and any other interested parties on the appropriate categories of the offence, the range of sentence for each category and both the aggravating and mitigating circumstances. Turning to the procedural criminal law, in submissions concerned with recommendations for a new more effective policy and the future conduct of relations between the police and the press, the Deputy Commissioner, Craig Mackey, has identified three issues of particular significance. Each of these is concerned with the operation of the PACE. The first concerns what he describes as the ‘camouflage of apparent co-operation,’ which itself can defeat an application for a production order because of the requirement in the access conditions, set out in para 2(b) of Schedule 1 to PACE, that ‘other methods’ of obtaining the material have failed or have not been tried because it appeared that they were bound to fail. The second relates to the extreme difficulty of obtaining journalistic material by means of a production order. The third concerns the absence of a statutory exclusion from journalistic material of items held with the intention of furthering a criminal purpose: that situation is to be contrasted with the fact that ‘criminal purpose’ material is excluded from legal professional privilege by s10(2) of PACE. I shall deal with them in turn. As to the first proposition, DC Mackey points to the evidence of non-cooperation that surrounded the attempt to search the NoTW building and what he described as ‘the veneer of apparent co-operation’ which followed.43 On that basis, it is argued that the police would not be able to satisfy the access conditions contained in para 2(b) because the company and its solicitors would always be able to point to assertions of willingness to assist, whatever was happening in fact. He submits that para 2(b) should simply be repealed.

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41 42

This recommendation is dealt with at length in Part H, Chapter 5 s120(6)(d) of the Coroners and Justice Act 2009 43 Part E, Chapter 5

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9.5

This proposition contains within it a far reaching challenge to the checks and balances that are built into PACE and, for my part, I am not convinced that it would be appropriate to infer from this particular investigation a wider problem concerning obtaining material in circumstances such as obtained here: even if that is the case, it is not evidenced. The second concern relates to the definition of journalistic material. The phrase is defined by s13(2) PACE as ‘in the possession of a person who acquired or created it for the purposes of journalism’. That phrase – the purposes of journalism – is not defined in the Act but has been given a narrow meaning in the context of the Freedom of Information Act 2000.44 I see no reason why there should be a different construction of the phrase in the context of PACE. The third concern relates to the question whether journalistic material continues to fall within the scope of excluded material (so as to fall within the scope of the second set of access conditions in Schedule 1 of PACE) if it has been created or acquired in furtherance of a crime. Mr Mackey poses the question: if there was iniquity such as crime or fraud did the duty of confidence ever arise? If not, then the journalistic material will not be held under an undertaking, restriction or obligation of confidence as required by s11(3) of PACE. Mr Mackey’s submission is advanced in this way:45 “The concept of confidentiality is subject to limiting principles, one of which is that the public interest in protecting confidences may be outweighed by some other countervailing public interest which favours disclosure, such as that a person cannot be the confidant of a crime or fraud (see Lord Goff in AG v. Guardian Newspapers (No. 2) [1990] 1 AC 109 at 282-3). However, the case law concerning the ’defence of iniquity’ deals with whether a contractual duty of confidence can be enforced (see e.g. Gartside v. Outram (1857) 26 LJ Ch (NS) 113, Initial Services v. Putterill [1968] QB 396, at 410). There is no direct authority on whether confidentiality under the PACE statutory decision still applies, where it is in the context of criminal behaviour. A caveat was expressly introduced into s10(2) of PACE, dealing with legal professional privilege [to the effect that Items held with the intention of furthering a criminal purpose are not items subject to legal privilege]. However, no such caveat was introduced into sll of PACE dealing with journalistic material held in confidence.”

9.6

9.7

9.8

9.9

The point is then made that similar provisions to Schedule 1 PACE are contained in Schedule 5 of the Terrorism Act 2005, which uses the same definitions of ‘items subject to legal privilege’, ‘excluded material’ and ‘special procedure material’ as in PACE. A simpler set of access conditions provides grounds on which an application for a production order could be granted under that Act even in relation to journalistic material (although one of the conditions is that it is in the public interest having regard to the benefit likely to accrue to a terrorist investigation if the material is obtained).46 The submission goes on (at para 3.6):

44

Sugar v British Broadcasting Corporation [2012] UKSC 4 per Lord Phillips (at para 67) “Information should only be found to be held for the purposes of journalism ... if an immediate object of holding the information is to use it for one of those purposes”; Lord Walker (at para. 84) “The question whether information is held for the purposes of journalism should thus be considered in a relatively narrow rather than a relatively wide way”; Lord Brown (at par 106) that “the central question to be asked ... will be ... whether there remains any sufficiently direct link between the BBC’s continuing holding of the information and the achievement of its journalistic purposes”. See also para 6.4 of the Annex of Legal Framework 45 pp12-13, paras 3.2-3.3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-submussion-fromMPS.pdf 46 Para 6 of Schedule 5 of the Terrorism Act 2005

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“Parliament has therefore expressly allowed applications to be made for excluded material (including journalistic material obtained in confidence) in terrorism cases, and added a ’public interest’ condition (similar to paragraph 2(c) of Sch.1 to PACE) under which the court can take into account, amongst other factors, whether the journalist or media corporation was involved in any criminal activity. Yet Parliament did not include any such provisions in PACE. It is arguable, therefore, that Parliament did not intend the courts to override the PACE definition of journalistic material held in confidence simply by saying it is not held in confidence where it is not in the public interest.” 9.10 It is certainly remarkable that Parliament might have provided greater protection for journalistic material than in relation to legal professional privilege as a matter of general law. Even more so that it would provide less protection for the material where the public interest is served in relation to a terrorist investigation than might be the case if that material has been created or acquired in furtherance of crime. Although the circumstances in which the provision might bite will hopefully be very rare, I see force in the submission that s11(3) PACE should be amended by providing that journalistic material is only held in confidence for the PACE provisions if it is held, or has continuously been held since it was first acquired or created, subject to an enforceable or lawful undertaking, restriction or obligation.47 I am very conscious that I have received submissions only from the MPS on this topic and that there is potential room for argument that any amendment to PACE will have far wider ramifications of which I have not been apprised and go beyond the limited goals that DC Mackey seeks to achieve. Before any conclusion can be reached on any of these issues, appropriate consultation will be essential. In the circumstances, without pre-judging any conclusion, I recommend that the Home Office should consider and, if necessary, consult upon (a) whether paragraph 2(b) of Schedule 1 to the Police and Criminal Evidence Act 1984 should be repealed; (b) whether PACE should be amended to provide a definition of the phrase “for the purposes of journalism” in s13(2); and (c) whether s11(3) of PACE should be amended by providing that journalistic material is only held in confidence for the PACE provisions if it is held or has continuously been held since it was first acquired or created subject to an enforceable or lawful undertaking, restriction or obligation.

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I do not ignore the considerations that flow from Article 10 of the ECHR and s. 10 of the Contempt of Court Act 1981 (as to which there is no material difference in principle: see Camelot Group plc v Centaur Communications [1999] QB 124 at 138G per Thorpe LJ). The courts will continue to have to consider these provisions and carry out a balancing exercise in any case involving the press even if the material is neither journalistic material or excluded within the PACE definitions: a summary of the position can be found in Shiv Malik v Manchester Crown Court [2008] EWHC 1362 (Admin) per Dyson LJ (as he then was) at paras 48 et seq

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1. Introduction
1.1 Appendix 4 describes the current law and identifies the flexibility that has allowed the common law to develop incrementally and in keeping with social developments and the principles enunciated in general terms by the European Convention on Human Rights. How otherwise could the law seek to deal with concepts which have only emerged in recent years, such as the explosion of communication on the internet, blogs which have the same (or greater) reach as traditional newspapers and the social media such as Facebook? The line drawn between personal and public space has to be re-evaluated in the light of the challenges that have been posed and it would be foolish to expect that change will not continue so that the challenges of next year will be different yet again to those faced today. A very good example of the way in which the law has had to re-evaluate its approach can be found in the developments relating to injunctive relief. Until the rise of the internet, with servers based out of the jurisdiction of the UK court but providing material to anyone with access to an online computer, and the additional changes consequent on social media, if the court prohibited the publication of any material, whether based on privacy, confidence or in any other circumstances, the law of contempt (for breach of the injunction) operated to ensure compliance. Attempts to ensure sufficient secrecy to provide effective relief led to what became known as super-injunctions, which in turn led to other difficulties.1 This Chapter is not intended to repeat the analysis of the way in which the substantive law has developed but rather to deal with the problems facing those who seek to enforce their rights. It concerns the complexity of the process of civil law and the availability (or otherwise) of funding for that purpose. Again, it is not intended as a definitive analysis of civil law procedure; it is to provide a sufficient landscape of the problems faced by claimants, the dilemmas faced by defendants and the (perfectly legitimate) attempts of each to confront them. The present position of the substantive law will then briefly be considered.

1.2

1.3

2. Civil proceedings: the present risk of litigation
2.1 For those without the experience, it might be thought an easy matter to start civil proceedings and, in some contexts, it is. In a myriad number of different circumstances, it is possible to do so on the internet. By way of example only, if a consumer wishes to pursue a retailer in relation to defective goods, if a tradesman wants to recover the amount that he is owed for work done and materials supplied, or if a landlord wants to commence proceedings for possession because of non payment of rent (or for other breaches of the tenancy), it is comparatively straightforward to access the court system and use a process called Money Claims On-line (MCOL) or Possession Claims On-line (PCOL) to do so. If the claim is not defended, obtaining a judgment is equally straightforward, although rather more is involved when it comes to enforcement.

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Appendix 4 and the Report of the Committee on Super-Injunctions chaired by Lord Neuberger MR: http://www. judiciary.gov.uk/Resources/JCO/Documents/Reports/super-injunction-report-20052011.pdf

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2.2

It goes further. The system encourages self help because, in a large number of cases, there is no provision for public funding to assist those who wish to pursue remedies for breach of their contractual or other rights. Legal aid used to provide that assistance but, to a large extent, because of its cost, it is no longer available. Citizen Advice Bureaus will advise members of the public as to what they can do to enforce their rights (or resist attempts by others to pursue them); other organisations in the third sector do likewise. How that should happen, who should do what, and how it is to be funded are part of the wide debate that surrounds access to justice. Where a claim is disputed, it is allocated to the type of trial associated with its value and/or its complexity. For small claims, such as consumer disputes or debt up to £5,000, the case will almost invariably be heard in the county court using the small claims procedure that is available. This jurisdiction leads to a hearing that will be conducted by a District Judge on an informal basis; in most cases, either one or both parties will be unrepresented and will look to the judge to conduct the proceedings in such a way as respects the rights of both parties and apply the law (which, in this type of case, is usually but not invariably straightforward). The judge will reach a decision and so provide the parties with the resolution of their dispute. In the context of this Inquiry, this straightforward means of obtaining access to justice is of very limited assistance because actions in defamation can only be commenced in the High Court;2 it is unusual for such claims to be remitted to the county court and even more unlikely that they will ever be considered suitable for the small claims procedure. Quite apart from the specific provision in relation to defamation, however, the real problem is that there are a large number of types of claim that are too complicated for self help. Many (particularly in the area of media law) require legal help and even ingenuity to pursue.3 Lawyers then become essential. Those of sufficient personal wealth can afford to fund legal advice and representation. Those who are not, cannot. For them a different mechanism to provide access to justice was provided in the form of the conditional fee agreement (CFA). By this arrangement, solicitors can act for a client on the basis that they work on the principle “No Win, No Fee”. In other words, solicitors approached by a potential client without funds make an assessment of the prospects of success in the case: if they consider that the prospects are good enough, they could offer this type of agreement, knowing full well that the law will recognise the agreement and, should their client succeed, allow them to obtain an order that the defendant in the litigation obtain an uplift (up to 100%) of the actual costs incurred (which will have to have been agreed by the defendant or assessed by the court). This uplift represents money that they would not earn from a fee-paying client but is intended to compensate for those cases which they take on but lose, when they forgo all the costs that they have incurred. There is an additional complication. Litigation in this country normally operates on the principle that the winner recovers his or her costs from the loser. If, for example, a member of the public sues a newspaper and wins, he or she can expect that the newspaper is good for the money and can pay the costs that the court orders to be paid; if the solicitors are working on a CFA, this will include the uplift. On the other hand, should the newspaper win, an order for costs will equally be likely to follow against the member of the public who may not have

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s15(2) of the County Courts Act 1984. The High Court can transfer proceedings to the county court pursuant to s40(2) of the Act 3 A good example of this legal ingenuity provided one of the sparks that has generated this Inquiry. In an attempt to learn whether she had been a victim of phone hacking, in July 2009, Sienna Miller issued proceedings against the MPS seeking disclosure of any material in its possession that provided evidence that she could use to deploy against NI: see http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Witness-Statement-of-Sienna-Miller.pdf. Her lawyers placed reliance on the decision in Norwich Pharmacal Co v. Customs and Excise Commissioners [1974] AC 133, obtained the order and the evidence. Many others have since followed suit.

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access to money and whose home or other assets would be at risk. To address that problem, the concept of after the event insurance (ATE) was introduced. 2.6 Everybody understands the protection that insurance provides. In the usual case, a premium is paid on the basis that if the insured event arises during the period of the insurance, a specified sum will be paid. Life insurance operates on the basis that an identified lump sum will be paid during the currency of the contract if the person who is the subject of the insurance dies. Travel insurance can insure against the risk of cancellation, baggage being lost in transit, medical expenses being incurred or a host of other risks. ATE is different. The event has occurred before the insurance is taken out. This insurance, however, is to cover the risk of failure of the litigation that arises out of the event. The premium is calculated by the underwriters, based on the risk that the litigation will fail and the amount at risk (the costs that would be ordered to be paid to the winning side) for which insurance is sought. ATE insurance has another benefit. As the law presently stands (although this is about to change), the premium itself is fully recoverable as part of the costs of the action so that if the beneficiary of the policy succeeds, not only are the solicitors’ costs (including the uplift of up to 100%) recovered but the premium for the ATE insurance is also recoverable. Furthermore, the premium can itself be conditional, in which circumstance it will only be payable if the action itself succeeds. On that basis, if the action fails so that the providers of the ATE insurance have to meet costs up to the insured limit, the solicitors will not recover their costs and the ATE insurers will not recover the premium (notwithstanding that they have had to pay out on the insurance). All this comes at a cost. Insurers will calculate the premium at an appropriate level so that recoveries in the successful cases compensate the loss of premium (and the costs paid) in the unsuccessful proceedings. It will be no surprise, therefore, that premiums have been high. The consequence has been a massive increase in the costs of litigation for defendants who lose and, thus, the cost of premiums for employers insuring against employees and public liability claims for those requiring road traffic insurance and many others. It has also increased the cost for those who self-insure, in which group newspaper titles are likely to be included. It resulted in lobbying the Government to change the rules, not only generally but specifically in relation to defamation. As a result, the Ministry of Justice issued a consultation paper on “Controlling costs in defamation proceedings”;4 having reviewed the responses it decided to invite the Civil Procedure Rule Committee (CPRC) to consider draft rules to implement a number of measures to control costs in publication proceedings. As a result, amendments to the Civil Procedure Rules and associated directions were introduced in all civil proceedings. The first change was to require notice of ATE insurance to be given to the other party with the letter before claim or within seven days of taking out insurance. Second, additional information was required to be given as to whether premiums are staged and, if so, the stage at which increased premiums become payable along with the level of insurance cover. Furthermore, in relation to publication proceedings only, the Rules introduced a period during which, if the defendant admitted liability and made an offer leading to a settlement, the defendant would not be liable for the ATE insurance premium.5 Running parallel with these changes, however, there was significant concern about costs generally so that a far wider scale review was undertaken by Lord Justice Jackson. He

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http://webarchive.nationalarchives.gov.uk/+/http://www.justice.gov.uk/consultations/controlling-costs-indefamation-proceedings.htm 5 http://www.parliament.uk/deposits/depositedpapers/2010/DEP2010-1241.pdf

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provided a preliminary report in May 2009;6 such was the significance of defamation and related proceedings (such as privacy) which generally involved the media that the topics were considered separately. Jackson LJ started by making the point that the monetary return by way of damages in actions of this type may not be substantial7 but that a claimant could attach great value to winning his claim because the judgment itself will provide vindication. This is an important point for two reasons. First, it emphasises the social objective of providing a mechanism for protection of reputation and personal privacy which is not easily protected simply by money. Second, it underlines that it would not be appropriate to require the same degree of proportionality in relation to costs as, for example, in a commercial dispute. 2.11 Another aspect of this type of litigation concerns what both claimants and defendants describe as aggressive litigating. Representatives of the press point to the observations of Lord Hoffmann in Campbell v MGN Ltd8 referring to “the conduct of the case by the claimant’s solicitors in a way which not only runs up substantial costs but requires the defendants to do so as well”, so that with the risk of a success fee “the defendant is faced with an arms race which makes it particularly unfair for the claimant afterwards to justify his conduct of the litigation on the ground that the defendant’s own costs were equally high”. Paul Dacre made a similar point, criticising lawyers for running “relatively straight-forward” cases on CFAs for “as long as possible”9 although, as Jackson LJ observes, if “relatively straight-forward” means that the claimant is bound to win, the change in the rules will assist by accruing cost benefit to early admission. Jackson LJ also noted that three claimant firms laid the blame at the door of media defendants effectively (and positively asserted by one) for dragging litigation out. This has some echo in the evidence heard by the Inquiry regarding what has been described as defensive attack.10 In the context of this issue, however, it does not matter who is responsible. Jackson LJ produced a final report in December 200911 and again returned to defamation and related claims. He noted the argument that libel law imposed excessive restrictions on free speech, with the further point advanced in an opinion of Lord Pannick QC and Anthony Hudson that the present system of costs recovery imposed a disproportionate regime such that it “cannot be convincingly be established that it is necessary and proportionate to a legitimate aim” rendering compliance with Article 10 of the ECHR arguable.12 The first point was countered by the submission that it is always open to publish on the basis of what can be proved to be true and that there is no public interest in misinformation. While accepting that

2.12

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Vol 1 is at http://www.judiciary.gov.uk/NR/rdonlyres/D2C93C92-1CA6-48FC-86BD-99DDF4796377/0/jacksonvol1low. pdf and vol 2 at http://www.judiciary.gov.uk/NR/rdonlyres/642936FA-292D-4432-8CF2-B2A44C7FC4FB/0/ jacksonvol2low.pdf 7 Jackson LJ noted the ‘notional’ ceiling on general damages awarded in defamation in the region of £215,000 to £250,000 (see Gur v. Avrupa Newspaper Ltd [2008] EWCA Civ 594; Tierney v News Group Newspapers Ltd [2006] EWHC 3275 para 10. In the final report he explained that the reason for this apparent limit is that “it is abhorrent if a claimant with serious personal injuries is treated less generously by the courts than a defamation claimant who (although distressed) remains fit and well” 8 [2005] UKHL 61 at para 31 9 In a speech to the Society of Editors in November 2008 10 Part F, Chapter 7 11 http://www.judiciary.gov.uk/NR/rdonlyres/8EB9F3F3-9C4A-4139-8A93-56F09672EB6A/0/jacksonfinalreport140110. pdf 12 This argument subsequently prevailed in the European Court of Human Rights following further litigation relating to Naomi Campbell when the Court ruled that the recovery of success fees at the level sought by lawyers in privacy and defamation cases represents a significant violation of freedom of expression. In that case, the figures were startling: Ms Campbell was awarded £3,500 in damages after the House of Lords ruled her right to privacy had been breached by a front-page story revealing her attendance at Narcotics Anonymous. Her legal costs came to more than £1m, including £288,468 base costs, £279,981.35 in success fees and £26,020 disbursements: see MGN v. United Kingdom (Application 39401/04)

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success fees and ATE premiums should cease to be recoverable, Jackson LJ was concerned to put other measures in place to ensure access to justice for claimants. 2.13 The special measures that he recommended were an increase in the general level of damages for defamation and breach of privacy by 10% (in line with his recommendation in relation to damages for personal injuries) with effect from the date that CFA success fees cease to be recoverable. The second is that the success fee (in the future to be paid by the claimant out of damages rather than the defendant) would be subject to negotiation but “x% of base costs, subject to a cap, the cap being y% of damages”. He goes on to observe:13 “The claimants in these cases (unlike personal injury claimants) do not need to devote any part of their damages to future care. Their main remedy … is vindication by the judgment of the court or the statement in court after settlement. I see no reason why such claimants should not be prepared to pay a substantial proportion of the damages to their lawyers as success fees.” 2.14 The principal recommendation concerned the mechanism for achieving the intended social objective of protecting claimants from adverse costs orders, on the basis that the paradigm libel case concerns an individual of moderate means and a well resourced media organisation. Jackson LJ therefore suggested qualified one way costs shifting for defamation and privacy cases, as similarly proposed for personal injury and judicial review so that the new provision of the Civil Procedure Rules (which would not require primary legislation) should provide: “Costs ordered against the claimant in any claim for defamation or breach of privacy shall not exceed the amount (if any) which is a reasonable one for him to pay having regard to all the circumstances including: the financial resources of all parties to the proceedings; and their conduct in connection with the dispute to which the proceedings relate.” 2.15 The broad recommendations made by Jackson LJ were accepted by the Government but the concept of qualified one way costs shifting in relation to defamation and breach of privacy has not, as yet, been adopted. Before elaborating on the effect of that, it is necessary to identify the changes that have been made by legislation contained within Part 2 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012. As enacted, s44 of the Act (amending s58 and s58A of the Courts and Legal Services Act 1990, which concerns the regulation of CFAs and the recoverability of success fees) will mean that a success fee under a CFA will no longer be recovered from a losing party although, subject to further regulation as to calculation and as to cap, the lawyers conducting proceedings under a CFA will be able to recover the fee from a client. Save in circumstances irrelevant to the type of litigation connected to the press, s46 of the Act abolishes the right to recover the ATE insurance premium. These provisions (due to come into force on 1 April 2013) undoubtedly remove the concern expressed by the European Court of Human Rights in MGN v United Kingdom. They will also dramatically affect the balance of the relationship between those who wish to complain about press conduct and the press.

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3. Litigation against the press
3.1 In order to understand the true impact of these changes to the law, it is necessary to go back in time to the period when legal aid (that is to say, state support) was available to fund civil litigation. This was subject to the means of the applicant and sufficiently authoritative legal advice that there was a more than 50% prospect of success or, to put the test another way, that advice would be given to a man of moderate means that the prospects of success were sufficiently good to justify the costs risks of undertaking the litigation. For millions of people, legal aid was a lifeline and permitted access to justice for those who could never otherwise have afforded to pursue a remedy for breach of their rights. The further, additional, benefit of legal aid was that it acted as a shield as well as a sword. Thus, not only did legal aid fund the legal costs of the assisted person, but (save in certain limited cases) it prevented the court from making an adverse order for costs against that assisted person should he or she lose the case. In other words, for those whose means were such that they were not required to make any contribution to their own legal costs, a successful defendant would be unable to recover its costs. In the main, this impacted on insurance companies but the consequences were well known and built into the risk assessment and, doubtless, the premium. In the same way that there was an exception to the way in which proceedings in defamation could be commenced, there was a further exception in relation to legal aid: put simply, whatever the means of the individual, legal aid was simply not available to pursue litigation based on the torts of libel and slander. This was before the days when CFA agreements were lawful, with the result that only the very rich or, at least, those who could afford or were prepared to take the risk of a substantial costs liability of losing an action were able to litigate. Power was very much in the hands of the press who (by way of comparison with most potential litigants) were well able to afford to litigate; they had in-house lawyers who were very familiar with the law and more than capable of advancing the case of the relevant title forcefully and with authority. Except where a litigant was so wealthy that the risk was simply not a factor, that power was real and must have caused very many who felt aggrieved (whether justifiably or not) by defamatory statements to refrain from seeking to pursue any remedy. In the same context, it must be borne in mind that even if a claim succeeded, damages for defamation were large (usually then determined by a jury); it depended on what view the particular (inevitably inexperienced) jury took of the defamatory statement. In most cases, slander (or spoken defamation) required proof of actual financial damage although in libel (written or broadcast defamation), no financial damage is required. Thus, although a very substantial sum might be awarded as damages, it was by no means guaranteed. CFAs changed the landscape entirely. Then, all who felt aggrieved at the way in which they had been treated by the press could seek legal advice and the operation of the libel laws (with the defendant having to prove the defence of justification or the circumstances of qualified privilege) created a climate in which redress was far more likely to be attainable and the power which had been with the press now moved to those who wished to sue. If a lawyer was sufficiently confident of the claim, proceedings could be threatened and then commenced on a CFA and the risk to the defendant was enormous. However modest any damages might be, the potential costs bill if the claimant succeeded, increased by 100% for the success fee and then further increased by the cost of the ATE insurance premium, was potentially prohibitive. The press felt driven to settle not only because the editor was prepared to accept that a mistake had been made or did not feel confident about the story that had been written but
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because, even if he or she did feel confident, the cost of losing was entirely out of proportion to the issue at stake. 3.6 This analysis is reinforced by the fact that defamation damages (now much more the province of judges, with juries being confined to few cases) have become easier to assess and (in order not to outstrip damages for personal injuries) were unlikely to be particularly substantial. Aggravated damages have always been modest and exemplary damages (intended to be punitive) were awarded in defamation only where it is established that the defendant’s conduct has been calculated to make a profit which might well exceed the compensation payable.14 Furthermore, in relation to privacy, the sum of £60,000 awarded to Max Mosley has been by far the largest award. In relation to his claim for exemplary damages, Mr Justice Eady adopted a restricted approach, deciding that it was not clear that misuse of private information was a tort to which the possibility of exemplary damages should necessarily extend: he considered it a matter for Parliament or, at the very least, the Supreme Court.15 Thus, the largest sum in play in connection with many claims in defamation and privacy claims is undoubtedly the costs.16 The change of the law enacted by Part 2 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 will again alter the balance between those who complain about the press and the press itself. If damages for invasion of privacy are comparatively modest and there is no prospect of recovering either the uplift on costs that has previously been a feature of the CFA or the premium for ATE insurance, the economics of litigation move against those who would otherwise challenge the press in favour of the press. Neither has this point been lost on the Core Participant Victims, who have complained about their treatment at the hands of the press: many have given evidence to the effect that they have only been able to pursue a remedy against the News of the World (NoTW) because of the existence of the CFA regime and that without it, they would have been left without the wherewithal to pursue a claim for damages at all.17 Privacy claims and claims of the type that have been pursued against the NoTW are not necessarily straightforward and, in the absence of appropriate legal assistance, there is no question of an equality of arms between those who claim to have been victimised and the press. The wealthy will be able to pursue a remedy in court; there will be less incentive for lawyers to take up the cases of those who are not because the potential uplift in costs now payable out of the damages is likely to be comparatively modest. Further, on the basis that the premium for ATE insurance will not be recoverable, it will be much more expensive to litigate with protection against an adverse order for costs and, in the absence of such protection, the risk of financial disaster may be real. On the other hand, it is not difficult to understand

3.7

3.8

14 15

Rookes v Barnard [1964] AC 1129 The reasons that Eady J gave were the absence of existing authority and concern about whether such a claim in relation to the misuse of private information satisfied the twin tests of necessity and proportionality in Art. 10 of the ECHR: see [2008] EWHC 1777, [2008] EMLR 20 at paras 172-197 16 The settlements that News International have agreed with a large number of those who have litigated in relation to phone hacking cannot be assumed to represent the sums that the court would have awarded 17 Numerous examples were provided by the evidence both of victims and solicitors acting in these cases: p10, lines 2-11, Sally Dowler, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Transcript-of-MorningHearing-21-November-2011.pdf; p39, line 15, Christopher Jefferies, http://www.levesoninquiry.org.uk/wp-content/ uploads/2011/11/Transcript-of-Morning-Hearing-28-November-2011.pdf; pp92-97, lines 21-5, Mark Lewis, http:// www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-of-Morning-Hearing-23-November-20111. pdf; p44, line 20, Gerry McCann, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-ofAfternoon-Hearing-23-November-2011.pdf; para 39: http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ Submission-on-behalf-of-Neil-Morrissey.pdf. In addition, when making submissions to Lord Justice Jackson, almost all claimant firms placed great importance on the role of CFAs in offering non-wealthy claimants access to justice

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the very real dangers of a system which loads costs so heavily against defendants, such that it is never economic to contest a claim and always (almost irrespective of the merits) more sensible to compromise at an early stage. The consequent and real risk to freedom of expression (recognised in MGN Ltd v United Kingdom) is obvious. 3.9 In recommending qualified one way costs shifting in defamation and privacy cases, Jackson LJ sought to find a balance between what might be described as the very substantial financial windfall of the CFA/ATE system on the one hand and the undeniable impact on access to justice by those without substantial means on the other. The recommendation has not found favour with the Government although it has emerged during the course of discussions about the draft Defamation Bill, now proceeding before Parliament. Thus, the Joint Committee on the Draft Defamation Bill18 observed (at para 89): “We are concerned that defamation law will become even less accessible to the ordinary citizen because the Government does not plan to apply to defamation all Lord Justice Jackson’s proposals that protect access to justice. For example, in respect of personal injury claims, there will be a cap on the amount that can be charged by lawyers as a success fee of 25% of the damages awarded. This cap does not apply to other civil claims, leaving the existing costs associated with 100% success fees in place. The Government’s proposal to increase by 10% the level of general damages payable in civil cases is designed to go some way towards helping parties to pay for their own costs and to meet any success fee if they win. There is also the argument that parties are likely to take greater care over incurring costs when they are paying the costs themselves. However, we do not believe that the 10% increase in damages will be enough to make a difference, given that the average level of damages in defamation cases is no more than £40,000, and costs tend to be in measured in hundreds of thousands when a case goes to court. The mechanism recommended by Lord Justice Jackson to protect the less well-off—known as “Qualified One Way Costs Shifting” (QOCS)—will also not be available in defamation cases under the Government’s proposals. This mechanism ensures that a claimant does not risk paying the costs of the defendant if the claim fails, unless they can afford to do so or have themselves acted unreasonably during proceedings. We consider that the application of this form of protection to defamation cases, as recommended by Lord Justice Jackson, may go some way to towards addressing the financial inequality that often exists. It is outside our remit to explore the impact of the Government’s separate proposals on civil litigation costs reform in detail. Nonetheless we are sufficiently concerned about them to ask the Government to reconsider the implementation of the Jackson Report in respect of defamation actions, with a view to protecting further the interests of those without substantial financial means.” [The emphasis is that of the Joint Committee.] 3.10 The response of the Government summarised the argument and recited that conclusion but was not prepared, at this stage, to revisit the issue. It said:19 “74. The current CFA regime with recoverable success fees and ATE insurance has led to high costs across all areas of civil litigation, but there have been particular concerns in defamation and privacy cases. These high and disproportionate costs hinder access to justice and can lead to a ‘chilling effect’ on journalism, and academic and scientific debate. The European Court of Human Rights judgment in January 2011 in MGN v the UK (the Naomi Campbell privacy case) found the existing CFA arrangements on recoverability in that particular case to be contrary to Article 10
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(freedom of expression) of the Convention. Changes to the existing CFA regime are therefore necessary. 75. The Government is aware of concerns around access to justice and the ability of those with modest means to pursue claims against often powerful media organisations. However, we do not believe that it is necessary to make any special provision in relation to the costs of privacy or defamation proceedings. As the Committee recognises, these claimants will benefit from a 10% increase in the general damages. The Government will continue to monitor the position following the implementation of the CFA reforms and the other reforms to the law and procedure for defamation claims which are being taken forward.” 3.11 The Court of Appeal has taken the lead in relation to the increase in damages. On 26 July 2012, in Simmons v Castle,20 the occasion of an application to approve a settlement in a personal injury appeal was used by a court comprising the Lord Chief Justice, the Master of the Rolls and the Vice President of the Court of Appeal (Civil Division) to increase general damages in tort (that is to say, in relation to non pecuniary loss) by 10% from current levels with effect from 1 April 2013. A further judgment adjusted the way in which the increase will be implemented to take account of the legislative change to CFA arrangements.21 The problem with this approach, on its own, is that it fails to take account of one aspect of the converse of the point recognised by Jackson LJ. He said (undoubtedly accurately) that a claimant would attach great value to winning his claim because the judgment would be vindication. In the case of defamation, that vindication is the public demonstration of success in the action, thereby neutralising the slander or libel. In the case of privacy, however, that which was private is no longer so and, irrespective of the condemnation that might flow from a judgment, what was placed in the public domain cannot be erased (even if some references can be removed from the internet). A modest increase in damages (themselves usually modest) will provide little encouragement to a claimant otherwise anxious to seek what might be entirely justifiable redress. In the absence of some mechanism for cost free, expeditious access to justice, in my view, the failure to adopt the proposals suggested by Jackson LJ in relation to costs shifting will put access to justice in this type of case in real jeopardy, turning the clock back to the time when, in reality, only the very wealthy could pursue claims such as these. I recognise (as did Jackson LJ) that most personal injury litigation succeeds with the result that qualified one way costs shifting in place of recoverable but expensive ATE insurance is just as likely to cost insurers less and, furthermore, that the same cannot necessarily be said for defamation and privacy cases. An arbitral arm of a new regulator could provide such a mechanism which would benefit the public and equally be cost effective for the press;22 if such a scheme is not adopted, however, I have no doubt that the requirements of access to justice for all should prevail and that the proposals of Jackson LJ should be accepted: I return to this recommendation at the end of this Chapter.

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[2012] EWCA Civ 1039; http://www.bailii.org/ew/cases/EWCA/Civ/2012/1039.html [2012] EWCA Civ 1288; http://www.bailii.org/ew/cases/EWCA/Civ/2012/1288.html 22 Part K, Chapter 7. As part of the response to encouragement by the Joint Committee to promote a voluntary, mediaorientated forum for dispute resolution, the Government recognised that there could well be value in there being a range of arbitration options available, noting that methods of redress and the type of body required to secure effective regulation were issues which are central to this Inquiry: see para 68

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4. The substantive civil law
4.1 The Inquiry has not provided a vehicle for detailed consideration of the substantive laws of defamation and privacy. As to defamation, Parliament is presently debating the Defamation Bill, which has already been the subject of pre-legislative scrutiny at a level and with an expertise that I would not hope to emulate. In the circumstances, I do not consider it to be valuable either to go over that ground or to postulate what might be the effect of any legislation eventually enacted. It might have been possible to review the law of privacy23 and there have been suggestions that a statutory enunciation of such a tort could be of value. Again, how it might be formulated and its possible extent has not been the subject of detailed evidence. In any event, the way in which the common law has addressed these issues has allowed flexibility of approach and a sensible enunciation of the relevant factors to be taken into account when balancing the competing issues in fact sensitive cases. I pay tribute to the work of the judges who have contributed to the jurisprudence in this area with clarity and care. It does not appear that legislative intervention will do other than generate further litigation as attempts are made to discover the extent to which the new framework matches the developing law.24 It goes without saying that any code will have to follow the law and that decisions of any regulator will have to follow the code: that is as far as it is necessary to go. I take the same view in respect of a statutory definition of the concept of the public interest. Depending on the circumstances, different situations will invoke different aspects of the public interest and the relevant considerations will be fact sensitive and of variable significance. As time passes and different social culture and customs develop, so the test will have to adjust. Whereas a regulator should be able to identify the public interest in the context of the press (as the Editors’ Code of Conduct seeks to do), the ability to adapt is important. Again, in line with the view expressed by the Joint Committee on Privacy and Injunctions, I endorse the view that the incremental approach of the courts to this concept is to be preferred and I do not recommend a statutory definition.25

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5. Damages
5.1 There is rather more to say on the subject of damages because of the need to treat as commensurate awards for non pecuniary loss in defamation and breach of privacy with similar awards (reflecting pain, suffering and loss of amenity) in claims for personal injury. In an attempt to ensure that balance is maintained, in John v MGN Ltd26 Sir Thomas Bingham MR (as he then was) put the matter in this way:27 “There is force in the argument that to permit reference in libel cases to conventional levels of award in personal injury cases is simply to admit yet another incommensurable into the field of consideration. … The conventional compensatory scales in personal injury cases must be taken to represent fair compensation in such cases unless and until those scales are amended by the courts or by Parliament. It is in our view offensive to public opinion, and rightly so, that a defamation plaintiff should recover
Appendix 4 This is the same view as that formed by the Joint Committee on Privacy and Injunctions in its Report: see http:// www.publications.parliament.uk/pa/jt201012/jtselect/jtprivinj/273/273.pdf (HL Paper 273; HC 1443), para 37 25 para 50, ibid 26 [1997] QB 586 27 at 614E
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damages for injury to reputation greater, perhaps by a significant factor, than if the same plaintiff had been rendered a helpless cripple or an insensate vegetable.” 5.2 Because of the primacy of the verdict of a jury, the assessment of damages in defamation could vary widely. Following Sutcliffe v Pressdram Ltd,28 trial judges were recommended to draw the attention of juries to the purchasing power of the award they were minded to make and the income it would produce and John marked the time from which the Court expressed the view that judges and counsel should be free to draw the attention of the jury to comparisons. Furthermore, in the light of the effect of s8 of the Courts and Legal Services Act 199029 the Court of Appeal is now far more willing to substitute its own view for that of the jury.30 As a result, more actions in defamation are now tried by judge alone (and the presumption in favour of jury trial is to be reversed by clause 8 of the Defamation Bill). Considering the circumstances, it is not perhaps surprising that awards for breach of privacy or breach of confidence have generally been comparatively modest. As already pointed out, the sum awarded to Mr Mosley (£60,000) being by far the largest31 although there have been other substantial awards: in an action both for libel and breach of confidence, for the latter (which concerned the disclosure of confidential harmful information), £30,000 was awarded. This would have been £40,000 but for the double counting for distress which was part of a further £50,000 awarded for libel.32 Other examples are somewhat lower. They include £5,000 awarded for the publication of photographs taken of a ten year old girl without the prior consent or knowledge of her parents or guardians: the child was shunned after friends saw her face on the front of a pamphlet setting out the Borough’s Aids strategy.33 £3,500 (including £1,000 by way of aggravated damages) was awarded to Naomi Campbell following the publication of her photograph leaving Narcotics Anonymous;34 £3,750 was awarded each to Michael Douglas and Catherine Zeta-Jones in connection with breach of confidence following the publication of covert wedding photographs;35 £5,000 awarded to Loreen McKennitt, from a former friend for violating the duty of confidence.36

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[1991] 1 QB 153; see Lord Donaldson of Lymington MR at 178-9; Nourse LJ at 185-6; Russell LJ at 190: thereafter (per Sir Thomas Bingham MR in John at page 608) “juries were reminded of the cost of buying a motor car, or a holiday, or a house” 29 Where the Court of Appeal had power to order a new trial on the ground that damages awarded by a jury were excessive or inadequate, this provision allowed the Court “to substitute for the sum awarded by the jury such sum as appears to the court to be proper” 30 For example, Thompson v Commissioner of Police for the Metropolis [1998] QB 513 which concerned false imprisonment and malicious prosecution but applies equally to damages for defamation which were extensively discussed 31 [2008] EWHC 1777 QB; Eady J said (at para 214) that “the purpose of damages, therefore, must be to address the specific public policy factors in play when there has been an ‘old fashioned breach of confidence’ and/or an unauthorised revelation of personal information. It would seem that the law is concerned to protect such matters as personal dignity, autonomy and integrity”. He went on (at para 216): “Thus it is reasonable to suppose that damages for such an infringement may include distress, hurt feelings and loss of dignity”. 32 Cooper & another v Turrell [2011] EWHC 3269 see per Tughendhat J (at para. 102) who described damages for misuse of private information as being “to compensate for the damage, and injury to feelings and distress, caused by the publication of information which may be either true or false(at para 102): http://www.bailii.org/ew/cases/EWHC/ QB/2011/3269.html 33 Adenjii v London Borough of Newham [Case 01TLQ 823], October 2001. This was an approved settlement (Garland J) in the High Court 34 Campbell v MGN [2004] UKHL 22 35 Douglas v Hello! [2003] EWHC 786 (Ch). The award of Lindsay J was upheld by the Court of Appeal 36 McKennitt v Ash [2005] EWHC 3003 QB

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5.5

I say at once that I do not consider it a coincidence that these last awards have been to those who could be described as ‘celebrities’: given the likely damages, it is only those who can afford it who have been able to bring such actions; CFAs might have assisted (as they have in the phone hacking litigation) but once, that source of funding is no longer available, the limited amount of money at stake and the high costs risks create a formidable obstacle for most, almost however egregious the breach of privacy or confidence might be. In saying this, I do not ignore the fact that many of these ‘celebrities’ chose to avail themselves of the CFA regime. In the context of an award of the size which has been awarded in cases of the type discussed, an increase of 10% will have little effect and will do almost nothing to ameliorate the impact of the loss of a CFA. In any event, although I recognise that damages for breach of privacy and confidence must be fixed with an eye on the equivalence of damages for pain, suffering and loss of amenity in personal injury cases, I am not satisfied that the assessment is presently pitched at the right level. I put the point in that way because neither do I consider that it is appropriate for the Inquiry, examining a wide range of issues, to undertake a fundamental re-appraisal of damages in this area or make recommendations in relation to change. Rather, it seems more sensible to pick up the suggestion that the damages should also be available for breaches of data protection principles (referable to the duration, extent and gravity of the contravention)37 and to recommend a review of damages generally available in this area, whether the cause of action is breach of data protection or privacy or breach of confidence or other media related torts.

5.6

5.7

Although guidelines for damages in personal injury cases are available,38 there are none for privacy or breach of confidence; judges only have the examples of awards that have been made at first instance or considered by the Court of Appeal. Rather than being dependent on a single view, a broader approach should be taken. The Civil Justice Council (CJC) was set up and established by s6 of the Civil Procedure Act 1997 and includes members of the judiciary, the professions, the civil service, consumer affairs bodies, lay advice and those able to represent the interests of particular litigants. Its functions include keeping the civil justice system under review, considering how to make it more accessible, fair and efficient, advising the Lord Chancellor and the judiciary on the development of the civil justice system and referring proposals for change to the Lord Chancellor and the Civil Procedure Rule Committee (CPRC).39 In the circumstances, I recommend that the Civil Justice Council consider the level of damages in privacy, breach of confidence and data protection cases, being prepared to take evidence (from the Information Commissioner, the media and others) and thereafter to make recommendations on the appropriate level of damages for distress in such cases. How the matter is then taken forward will ultimately be for the courts to determine.40

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Aggravated damages are primarily awarded to compensate for injury to pride and dignity, and the consequence of humiliation, and can include a penal element: this type of award is

Part H, Chapter 5 Guidelines for the Assessment of General Damages (11th edition) has recently been published by the Judicial College (previously the Judicial Studies Board) 39 s 6(3)(a)-(e) of the Civil Procedure Act 1997 40 As was the case in relation to the 10% increase proposed by Jackson LJ adopted in Simmons v Castle [2012] EWCA Civ 1039
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the subject of detailed consideration in the Report of the Law Commission on Aggravated, Exemplary and Restitutionary Damages.41 This report, as long ago as September 1997, recommended that legislation should provide that this head of damages should only be awarded to compensate for mental distress and should have no punitive element. I do not seek to improve on the analysis contained in that report and recommend that it be adopted: on its own, however, it will not make a significant difference to the overall award. The question of exemplary damages is different and is itself worthy of consideration. 5.9 I recognise that the law in relation to the award of exemplary damages is by no means straightforward, having been considered in three cases in the House of Lords and one case in the Supreme Court in less than 50 years.42 An award can be made in only two categories at common law (oppressive, arbitrary or unconstitutional action by the servants of Government and cases in which the defendant’s unlawful conduct has been calculated by him to make a profit for himself, which may well exceed the compensation payable to the claimant) and, third, where expressly authorised by statute. In one sense, it is appropriate to argue that the type of invasion of privacy and defamation involved in many of the circumstances which have been examined during the course of the Inquiry have been pursued specifically to make a profit (by maintaining of developing sales of the paper or encouraging readership rendering the publication more attractive for advertisers). On the other hand, I recognise the understandable reluctance of judges to extend this somewhat anomalous punitive jurisdiction without a clear basis in law for doing so. Again, this topic was the subject of the Report by the Law Commission which recommended that exemplary damages should be retained (although re-titled as punitive damages).43 It recommended that such damages should only be awarded where, in committing a wrong, the defendant ‘deliberately and outrageously disregarded the [claimant’s] rights’. Moreover, it should be capable of being awarded for any tort (including breach of confidence) and would be available if the judge considers that other remedies will be inadequate to punish the defendant for his conduct; for these purposes, the court may regard deterring the defendant and others from similar conduct as an object of punishment. In that regard, it seems to me entirely appropriate that, when considering the question of exemplary damages, the court should be entitled to consider membership of a regulatory body as being relevant to the willingness to comply with standards (whether or not there was a failure to comply in relation to the subject matter of the action). In addition, the demonstration of good internal governance in relation to an appropriate audit by the editor as to the origin of stories should also be material. Equally, but on the other hand, a refusal to participate in a regulatory body might itself be evidence of a deliberate decision to stand outside any approved regulatory regime which itself could go towards the demonstration of outrageous disregard, as could the absence or failure of any adequate procedures for internal governance.

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http://lawcommission.justice.gov.uk/docs/lc247_aggravated_exemplary_and_restitutionary_damages.pdf Rookes v. Barnard [1964] AC 1129, Cassell v Broome [1972] AC 1027, Kuddus v Chief Constable of Leicestershire Constabulary [2002] 2 AC 122 and, in the Supreme Court, in R (Lumba) v Secretary of State for the Home Department [2011] 2 WLR 671 43 http://lawcommission.justice.gov.uk/docs/lc247_aggravated_exemplary_and_restitutionary_damages.pdf Part 4 (page 53 et seq) analyses the law as at 1997 and although there may well have been some developments since then (although the caution of Eady J in Mosley is to be noted), a more detailed up to date analysis is not necessary for the purposes of my recommendations
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5.12

Although it is tempting to analyse the comparative jurisprudence, the matter is fully discussed by the Law Commission and I see no value in repeating the argument. In that regard, I recognise that the Law Commission Report equally deals with other difficult issues44 which it is unnecessary for me to address. Having said that, to my mind, the basic principle is straightforward. The commercial benefit from publishing material obtained in breach of rights to privacy or confidence is likely greatly to exceed the basic award of damages (even if increased by the award of aggravated damages) and constitutes no real deterrent. In common with the Joint Committee on Privacy and Injunctions, I have no doubt that the court should be able to award exemplary damages in privacy cases45 and, I would add, breach of confidence and similar media torts. In the circumstances, in line with the conclusion in the Report of the Law Commission on Aggravated, Exemplary and Restitutionary Damages, I recommend that exemplary damages (whether so described or renamed as punitive damages) should be available in actions for breach of privacy, breach of confidence and similar media torts as well as for libel and slander. Voluntary participation in a regulatory regime contained in or recognised by statute and good internal governance in relation to the sourcing of stories should be relevant to the decisions reached in relation to such damages.

6. Costs
6.1 The impact over the years of different funding arrangements and costs regimes to litigation in this area is described above. Although the Government has made clear its concerns around access to justice and the ability of those with modest means to pursue claims against often powerful media organisations, the recommendations made by Jackson LJ for one way qualified costs shifting have not, to date, found favour. As the Joint Committee observed, access to justice must be maintained for all citizens seeking to protect their right to privacy.46 In the light of the very real difficulties facing those seeking access to justice, I have no doubt that a regulator needs to provide a speedy, effective and costs-free regime which provides a mechanism for those who complain that their rights have been infringed to be able seek redress. This is equally in the interests of the press who, although an increased number of complaints might be made, will equally be able to hold up the system as a model of dispute resolution which is much cheaper (and less time consuming) than litigation through the courts. It would need to be staffed by experienced media lawyers but there are retired High Court judges and others very experienced in this area of law who are more than capable of taking on what could be an inquisitorial jurisdiction efficiently to resolve all but those which both parties agree (or the judge determines) need court process. One such proposal is discussed as part of the regulatory regime later in the Report.47 The purpose of this part of the Report is not to analyse the way in which such an arbitral system might operate but to consider how the law could recognise its existence and encourage its use. The mechanism for doing so is in relation to costs. Thus, Part 44.3 of the Civil Procedure Rules 1998 (as amended) specifically provides the court with a discretion as to whether costs should be payable by one party to another, the amount of those costs and when they are to

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Such as those that surround the need to make a single award shared between multiple victims: see R (Lumba) v Secretary of State for the Home Department [2011] 2 WLR 671 per Lord Dyson at para. 167. Assessment is not without difficulties where there is more than one tortfeasor: see Gatley on Libel and Slander, 10th edn, para 9.25 45 Para 134, http://www.publications.parliament.uk/pa/jt201012/jtselect/jtprivinj/273/273.pdf 46 Para 147, ibid 47 Part K Chapter 6

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be paid; it identifies the general rule that the unsuccessful party will be ordered to pay the costs of the successful party but specifically provides a discretion to make a different order. Included within all the circumstances to which the court must have regard is the conduct of the parties48 and the concept of conduct includes “conduct before, as well as during, the proceedings”.49 In that context, it is important to bear in mind the overriding objective of the Civil Procedure Rules to enable the court to deal with cases justly.50 6.4 There is no doubt that if a party to litigation turns down the opportunity to participate in ADR (particularly if encouraged by the court), costs consequences may follow. Thus, in Halsey v Milton Keynes General NHS Trust; Steel v Joy,51 the court considered the consequences of failure to participate in mediation as a form of alternative dispute resolution. It recognised that unreasonable refusal to agree to ADR could properly be reflected in adverse orders for costs and identified the relevant factors to be taken into account. In those cases, mediation was intended to encourage parties to reach an agreement on a sensible resolution of their dispute; arbitration (as here proposed) provides an alternative to a trial and is intended to be speedy, effective and without the cost implications of litigation in court. It results in a solution that is imposed by a judgment. The case for recognising the value of this form of dispute resolution (and the consequential saving of costs) is, therefore, much stronger and entirely consistent with the overriding objective of the Civil Procedure Rules. This analysis provides ample precedent for the use of the powers of the court to encourage appropriate alternatives to litigation and there could be no better method for resolving a dispute with the press than by utilising a specialist tribunal, set up specifically for the purpose; it should be staffed by experts in media law who understood both the law and the practices of the press and so could cut through procedural complexity and resolve the issues speedily, cheaply and effectively. It is obviously important that, before taking into account the availability of the remedy, the court would have to be satisfied that a mechanism for dispute resolution set up by one of the parties (in this case the publisher), is fair: it would not be sufficient if the alternative was an ad hoc arrangement in which nobody was representing the interests of the claimant. For that reason, I consider it very important that the arbitral system should be one part of a regulator which is recognised as being truly independent of the press and independent of any other interests which might affect its ability to be seen to be fair. An ad hoc arrangement (or even a settled scheme for one publisher) would be too dependent on the goodwill of those who made the arrangement or the publisher who set up the scheme to guarantee that independence. If an arbitral mechanism was set up through the regulator, however, I see no reason why the courts should not embrace it as an extremely sensible method of pursuing the overriding objective in civil cases. In those circumstances, costs consequences could flow both ways. Thus, if the relevant media entity was regulated and thus able to utilise the availability of the arbitration service, it would be strongly arguable that a claimant who did not avail himself of that cheap and effective method of resolving his dispute but, instead, insisted on full blown High Court litigation, should be deprived of any costs even if he is successful: that might

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CPR 44.3(4)(a) CPR 44.3(5)(a) 50 CPR 1.1(1). By 1.1(12), dealing with a case justly includes, so far as is practicable, (a) ensuring that the parties are on an equal footing ; (b) saving expense; (c) dealing with the case in ways which are proportionate to the amount of money involved, to the importance of the case, to the complexity of the issues; and to the financial position of each party; (d) ensuring that it is dealt with expeditiously and fairly; and (e) allotting to it an appropriate share of the court’s resources while taking into account the need to allot resources to other cases 51 [2004] EWCA Civ 576; [2004] 1 WLR 3002; [2004] 4 All ER 920
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also be a powerful incentive for a publisher to join the regulator, particularly if concerned that an extremely wealthy claimant might otherwise seek to overwhelm the publisher with expensive litigation out of all proportion to what was at stake. 6.8 Equally, however, if a publisher did not join the regulator, with the result that the specialist arbitral system was not available to a claimant wishing to pursue a remedy (particularly if of limited means and, thus, unable otherwise to obtain access to justice), I see no reason why the court should not be able to deprive even the successful publisher of costs that would not have been incurred had the alternative arbitration been available. I go further and suggest that, in a case legitimately brought and potentially borderline, the court would even retain the discretion to order the successful publisher to meet the costs of an unsuccessful claimant (although I recognise that this would not be the case if the court was dealing with vexatious or utterly misconceived litigation). Ultimately, the discretion of the court would govern all these issues, but I see only advantage in supporting an arbitral system that could be seen to have been independently set up and operated by a regulator, albeit itself set up by the press but managed and run independently of it. It is obviously important that there should not be an ever-running argument about the adequacy of the arbitral mechanism. In the circumstances, I recommend that the Civil Procedure Rules should be amended to require the court, when considering the appropriate order for costs at the conclusion of proceedings, to take into account the availability of an arbitral system set up by an independent regulator itself recognised by law.52 the purpose of this recommendation is to provide an important incentive for every publisher to join the new system and encourage those who complain that their rights have been infringed to use it as a speedy, effective and comparatively inexpensive method of resolving disputes. 6.10 It is obviously necessary to consider the alternative, that is to say, what would happen if there was no identifiably independent regulator that could be recognised by the courts as providing an acceptable alternative mechanism for the resolution of disputes. It is here that I share the very real concern expressed by the Joint Committee in relation to access to justice. The prospect of returning to a system whereby only the very rich could pursue defamation, breaches of privacy and confidence or other claims in tort against publishers because of the potential costs consequences would, in my view, be a seriously retrograde step in our attempts to provide justice for all. In my view, it is simply not acceptable. The very least that could be done is to revert to the scheme proposed by Jackson LJ. In the absence of the provision of an alternative mechanism for dispute resolution, available through an independent regulator without cost to the complainant, together with an adjustment to the Civil Procedure Rule to require or permit the court to take account of the availability of cost free arbitration as an alternative to court proceedings when considering orders for costs at the conclusion of proceedings, I recommend that qualified one way costs shifting be introduced for defamation, privacy, breach of confidence and similar media related litigation as proposed by Lord Justice Jackson.

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Part K Chapter 6. The mechanism for achieving this objective could be amendment of CPR 44.3 and, in the discretion of the court, could be of relevance beyond a system of arbitration that is created by a new press regulator

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CHAPTER 4 THE PRESS COMPLAINTS COMMISSION AND ITS EFFECTIVENESS
1. Introduction
1.1 The Press Complaints Commission (PCC) has always been a voluntary system based on a network of implied contracts. Accordingly, participation has been optional, and in the event never universal; and has always been contingent on an evaluation by individual titles or publishers of their self-interest. Newspapers notionally sign up, and remain tied into the rules of the system, but only for the period and to the extent that they judge that this is in their best interests. The self-regulatory system as a whole, and by this I include its less visible elements, the Press Board of Finance (PressBoF) and the Editors’ Code of Practice Committee, are intertwined legally and functionally symbiotic. It follows from this that criticisms of the PCC have often been too specifically directed and as such may have missed their mark; it is the system as a whole which should be the accurate target. The way in which the various parts interact is the hallmark of the system as I have broadly defined it; in a less obvious but equally powerful way it should also be regarded as the key descriptor of the relationship that the industry has with the PCC. Although the system as constituted in this manner unravelled, in spectacular fashion, in July 2011, the inherent weakness was there for all to see almost from the very start. There were aspects of the work that the PCC did well which should not be overlooked or minimised as the weaknesses of the system are exposed. The secretariat worked very hard; in many cases the PCC managed to negotiate or mediate settlements which resulted in proportionate redress and satisfied complainants. Some of the pre-publication work undertaken by the PCC was effective and has assisted people under real pressure from the industry. The two directors of the PCC who gave evidence on these matters1 were impressive and dedicated individuals who worked tirelessly, often in difficult circumstances. Throughout, my Report has not sought to blame individuals but to focus on practices and systems. I will continue with this approach although the evidence demonstrates that the stature and profile of the PCC has, to some considerable extent, depended on the quality and personality of its Chairs. In the circumstances, I will refer to each of the four who gave evidence; they tackled different issues at different times and did so with differing degrees of success. This analysis of their stewardship of the PCC is a significant part of the overall narrative. Even so, my headline assessment is that the problem was and is systemic: the PCC is hidebound by its inherent structure such that it has lacked the powers and sanctions required to do an effective job, which was – or at least ought to have been – to regulate the industry under its umbrella. Instead, self-regulation was simultaneously a panacea, a misnomer and a contradiction in terms. The press caused or permitted it to pronounce itself as a model of self-regulation for the press as a whole but the upshot was something well short of regulation properly so-called. The PCC was not independent from the industry it was overseeing, causing problems both of substance and of perception. The way in which it and the self-regulatory system more generally conducted itself in public was often unhelpful. The purported investigations into

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Guy Black, as he then was, was director of the PCC until 2003, but his evidence did not cover this part of his career. I have no reason to exempt him from the observations I make about his successors

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press misconduct, most notably the two reports into phone hacking, were ineffectual and inadequate; and their conclusions, apparently exculpating the News of the World (NoTW), and, as it happens all other titles, from the accusations of serious misconduct, gave false comfort to policy-makers and the public. Taken together these factors caused the selfregulatory system to fail. However good the rest of the work that the PCC did, it steadily lost the trust of key stakeholders, culminating in a final flight of trust and confidence in the wake of the revelations which triggered this Inquiry to be set up. 1.6 By July 2011, some might say somewhat late in the day, key politicians had also lost faith in the self-regulatory system. On 8 July 2011, the Prime Minister said that the PCC had failed and needed to be replaced:2 “Let’s be honest. The Press Complaints Commission has failed. In this case, the hacking case, frankly it was pretty much absent. Therefore we have to conclude that it’s ineffective and lacking in rigour. There is a strong case for saying it’s institutionally conflicted because competing newspapers judge each other. As a result it lacks public confidence. I believe we need a new system entirely. It will be for the inquiry to recommend what the system should look like. “But my starting presumption is that it should be truly independent, independent from the press, so the public will know that newspapers will never again be solely responsible for policing themselves. But vitally, independent of government, so the public will know that politicians are not trying to control or muzzle a press that must be free to hold politicians to account.” 1.7 The Deputy Prime Minister also agreed that the PCC and the self-regulatory system generally had failed.3 The Leader of the Opposition, said in a speech on 8 July 2011 that:4 “…we need wholesale reform of our system of regulation. The Press Complaints Commission has failed. It failed to get to the bottom of the allegations about what happened at News International in 2009. Its chair admits she was lied to but could do nothing about it. The PCC was established to be a watchdog. But it has been exposed as a toothless poodle. Wherever blame lies for this, the PCC cannot restore trust in self-regulation. It is time to put the PCC out of its misery. We need a new watchdog.” 1.8 Significant sections of the press had also lost confidence in the self-regulatory system. In January 2011, by refusing to make the appropriate contribution through PressBoF, Northern & Shell left the PCC which meant that it could no longer offer a service in relation to Express Newspapers or the Star titles. Both Richard Desmond, the proprietor of the Northern & Shell group, and Paul Ashford the Group Editorial Director, gave evidence that one of the key factors that prompted Northern & Shell’s withdrawal from the self-regulatory structure was that they had lost confidence in the PCC; in particular, they were not confident of its independence.5

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The Independent, ‘PM signals end of Press Complaints Commission’, 8 July 2011, http://www.independent.co.uk/ news/media/press/pm-signals-end-of-press-complaints-commission-2309210.html; pp58-60, lines 19-4, David Cameron MP, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Transcript-of-Afternoon-Hearing-14June-2012.pdf 3 p4, para 18, and p18, para 85, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Witness-Statementof-Nick-Clegg-MP2.pdf; pp10-11, lines 15-24, Nick Clegg MP, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/06/Transcript-of-Morning-Hearing-13-June-2012.pdf 4 pp17-18, Ed Miliband, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Exhibit-EM-22.pdf 5 p37, lines 12-24, Paul Ashford, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofAfternoon-Hearing-12-January-2012.pdf; pp73-77, lines 25-2, Richard Desmond, http://www.levesoninquiry.org.uk/ wp-content/uploads/2012/01/Transcript-of-Afternoon-Hearing-12-January-2012.pdf

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Even if there may have been an element of the self-serving in this assessment, it is not difficult to understand why that might have been. In any event, other key newspaper figures had also begun to lose faith in the PCC. The editor of the Financial Times, Lionel Barber, gave evidence to the Inquiry that the PCC’s decision to criticise the Guardian in its 2009 report into phone hacking was a serious misstep, and that “as a result of that I believe that the body has lost credibility”.6 1.9 Furthermore, the self-regulatory system was not trusted by many of the organisations representing the interests of the people and groups who became the subject of media coverage. For example Trans Media Watch, an organisation dedicated to combating discriminatory and or derogatory coverage of transgender and intersex people in the media, submitted evidence that “The Press Complaints Commission (PCC) is widely regarded as an ineffective joke by the transgender community.”7 Individuals who were regularly the subject of press attention, and those who had been the victims of press intrusion, likewise did not have confidence in the PCC. The actor Steve Coogan, for example, gave evidence that he did not have confidence in the independence of the PCC, and concluded that “If I had more faith in it, then I’d use it”.8 Experienced media lawyers, who have dealt routinely with issues of inaccuracy and intrusion, both of which fall within the PCC’s remit, also gave evidence that they had lost faith in the capacity of the PCC. Mark Thomson, a lawyer who has represented many victims of press intrusion, was of the view that the PCC was not sufficiently effective or independent of the press.9 Another media lawyer, Graham Shear, agreed.10 By the summer of 2011, the standing of the self-regulatory system in general and the PCC in particular had deteriorated further. Although key stakeholders and observers may have had differing experiences of the press and their views may have been coloured by various interests, their common conclusion that the self-regulatory structure had failed cannot be explained away by self-interest or subjective perspective. Ultimately, this disintegration of trust in the PCC was the straw breaking the camel’s back. In the absence of any powers to compel anybody, the PCC was reliant on the continued trust and confidence of the public, politicians and the press in its authority; and in its capacity to enforce proper standards of press behaviour. What remained of the PCC’s authority departed with the flight of trust and everyone agrees that it is no longer viable for the current selfregulatory structure to continue in its present form or state. I cannot emphasise too strongly that the revelations of July 2011 must not be visualised in any sort of self-contained way as a watershed or a bolt from the blue in the context of the 21 year history of the PCC. To interpret events in such a way would, in my view, amount to a form of historical revisionism which ignores the whole of the post-War narrative and the performance of the PCC since its creation in 1991. Arguably, though, one may detect elements of such an approach in some of the less than wholly self-critical statements by PressBoF and the PCC itself as late as 2009/2010.

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p46, lines 20-21, Lionel Barber, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-10-January-2012.pdf 7 p7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Submission-by-Trans-Media-Watch.pdf 8 pp45-46, lines 20-12, Steve Coogan, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-ofAfternoon-Hearing-22-November-20111.pdf 9 pp42-45, lines 9-19, Mark Thomson, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-ofMorning-Hearing-24-November-2011.pdf 10 pp62-64, lines 15-9, Graham Shear, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Transcript-ofMorning-Hearing-21-November-2011.pdf

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Having introduced the issues in this way, the next section of this Chapter will address these systemic issues on a thematic rather than a chronological basis. To be fair to the PCC, it would be insufficient merely to rehearse the fact that political and public support for it has evaporated. Although I have to record and recognise that, as a practical reality, since on any view it would justify (if not require) fundamental change, the reasons for such loss of support do need to be examined and set out. The sections of this Chapter that follow look by turns at the PCC’s lack of any meaningful independence from the industry it purported to regulate; the self-association and alignment of the PCC with the interests of the industry rather those who were the victims of mistreatment by the press; the systemic failings in the system of self-regulation; and the failures in regulatory delivery. Lastly, this Chapter will examine the investigatory failures of the PCC both in relation to the findings of Operation Motorman and the allegations of phone hacking at the NoTW both in 2007 and 2009.

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2. What the PCC did well
2.1 2.2 Before starting on an analysis of what went wrong, I should record what the PCC did well. Successive witnesses gave evidence that the PCC secretariat, in particular the complaints officers who handled complaints made by members of the public, were polite, efficient and dedicated.11 Members of the PCC secretariat worked hard in the public interest, as I have said, in sometimes difficult circumstances. The PCC established and then ran a 24 hour helpline for complainants, staffed by a small number of officers working in rotation.12 For a relatively small team to have handled the large volume of complaints received by the PCC speaks of the dedication and commitment of individual staff members. I have seen no evidence and heard no suggestion that the manner in which the members of the PCC secretariat have gone about their work has led or, in any sense, contributed to the limitations of the PCC as an organisation. I have no doubt that PCC staff did as well as is possible within the bounds set by the self-regulatory system. I also heard evidence from the then current director of the PCC, Stephen Abell, and his immediate predecessor, Tim Toulmin, of the work done by PCC staff on a day to day basis. I should add that Mr Abell’s witness statement was a genuine tour de force and I pay tribute to the immense care he has taken and the diligence he has shown. Through their respective evidence, each demonstrated his dedication and loyalty to an organisation which faced a naturally daunting task. The efforts of the PCC at mediation and conciliation were often helpful. Dr Martin Moore, the Director of the Media Standards Trust,13 highlighted “the genuine benefits of the current system, particularly with regard to the secretariat and the role they’ve played in conciliating and mediating complaints on behalf of complainants, and the very real attempt to both write and evolve the code over that 20-year period [that the PCC has been in existence]”.14 On most

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pp35-36, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust. pdf 12 p171, para 247, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 13 Having paid fulsome tribute to Mr Abell’s witness statement, I should also record my admiration for the Media Standard Trust’s work in this area. The relevant material and submissions is on the Inquiry website. Given its comprehensiveness, I have sought to boil the issues down somewhat 14 p26, lines 10-22, Dr Martin Moore, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-10-July-2012.pdf

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occasions, complainants were satisfied with the mediated and agreed solutions to problems; and this was a job that the PCC was good at.15 In appropriate cases, and no doubt there are many, a mediated settlement is a sensible way of dealing with disputes between parties. 2.5 The PCC was also, on occasion, able to mitigate extreme media pressure on newsworthy individuals.16 Dr Gerry McCann, for example, gave evidence that the PCC managed to limit the intrusion by journalists and press photographers into the lives of his twin son and daughter in the aftermath of the disappearance of his daughter Madeleine:17 “The PCC was extremely helpful in dealing with the unwanted intrusion into the privacy of our twins. In particular, the press were constantly taking photographs in which our children were included. Having contacted the PCC this quickly stopped”. 2.6 Baroness Buscombe, the former Chair of the PCC, said of this aspect of the PCC’s prepublication work that:18 “This is an area of [the PCC’s] work that has developed in recent years and which has had an enormously beneficial impact… I well recall that when I began working at the PCC, I was amazed by the degree to which we are able to stop within hours or minutes the publication of information, including pictures, where there was a potential breach of the Code. The key to this is strong and very responsive engagement with the industry, night and day.” 2.7 In some cases the pre-publication guidance which the PCC produced was effective, and resulted in some improvements to the press coverage of the issues concerned. For example, the PCC has worked hard to improve the coverage of mental health issues. To this end, the PCC has produced a guidance note on the subject and has delivered training to journalists.19 It is difficult to form a clear judgment about this, but the sense I have is that press reporting on some aspects of mental health issues has improved, and the insensitive and in many cases offensive language deployed in some sections of the press ten years ago is now rarely used. However, in this context, I note the evidence submitted by organisations such as Mind and Rethink Mental Illness which indicates that problems remain. Recognising this, the points they make reflect on the press in general rather than on the PCC. I should record that there are other instances where the efforts of the PCC in respect of prepublication action have not been so successful. For example, the Inquiry has heard evidence from Helen Belcher of Trans Media Watch, who recalled that this organisation worked with the PCC to try to improve press coverage of intersex and transgender people. The PCC agreed to endorse a style guide prepared by Trans Media Watch. This was completed in February

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p69, lines 3-6, Professor Brian Cathcart, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Transcriptof-Morning-Hearing-8-December-20111.pdf; p63, lines 1-5, Graham Shear, http://www.levesoninquiry.org.uk/wpcontent/uploads/2011/12/Transcript-of-Morning-Hearing-21-November-2011.pdf 16 p5, para 6.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-Tim-Toulmin. pdf; p6, para 25, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Witness-Statement-of-Giles-Crown. pdf 17 p17, para 103, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Witness-Statement-of-GeraldPatrick-McCann.pdf 18 pp4-5, para 25, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-BaronessBuscombe1.pdf 19 pp218-221, paras 304-314, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf

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2011 and distributed among newspaper editors and to some individual journalists. However, in the view of Ms Belcher “its impact has, to date, appeared to be extremely limited.”20

3. Independence from the industry
3.1 A profound lack of any functional or meaningful independence from the industry that the PCC claimed to regulate lay at the heart of the failure of the system of self-regulation for the press. Independence operates at two levels, one of perception and the other of substance. In terms of perception, just as judges cannot in any sense be perceived as being judges in their own cause, or appearing to be biased or otherwise interested in the outcome, a regulator must be so constituted as to satisfy every reasonable complainant that he or she will receive a fair hearing in all respects and at all levels. In terms of substance, a regulator will not be free to do its job properly if tied functionally to the entities it is regulating. Further, there is a not insubstantial risk that, if those that are being regulated take the view that they are being judged by fierce competitors for whom they have neither trust nor respect (even if there is a majority of lay members of the Commission), they will not regard the discharge of the regulator’s duties in the correct light. The self-regulatory system for the press, taken as a whole, is not in any way independent of the industry. In particular, two out of the three elements of the self-regulatory structure – PressBoF (on whom the PCC is dependent for its funding) and the Editors’ Code of Practice Committee – are wholly composed of serving industry figures and, in both cases, extremely senior industry figures. While the PCC may itself be made up of a majority of lay members, for the reasons explored below this does not make the PCC functionally independent from the industry.

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Funding
3.3 The PCC’s funding is derived from subscriptions raised voluntarily from the industry. The budget for the PCC is negotiated between the PCC and PressBoF and the agreed funds are then levied from the industry. In the words of Baroness Buscombe, “[p]ublic confidence is plainly more difficult to establish in this context”.21 Lord Grade, a lay PCC commissioner, made the point in the following way:22 “…the fact that PressBoF controls the purse strings leaves them in the position where – which they either do or they don’t abuse – I don’t have enough experience yet, but it leaves them in the position where they can have a huge influence on the constitution and the running of the organisation. I don’t think that’s healthy.” 3.4 Of course, other regulators are funded solely with monies raised from the regulated industry. One example of this is the Advertising Standards Authority (ASA), which is wholly funded by a levy raised on the advertising industry through the funding body ASBoF. The difference, as Baroness Buscombe has made clear, is that in contrast to ASBoF, PressBoF sought to be far more ‘hands on’ in relation to expenditure issues.23

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3.5

I recognise that PressBoF itself robustly denies that it seeks to exercise any measure of control, pointing out that there have been no occasions on which a request by the PCC for extra funding has been turned down. However, in my view this misunderstands the nature of the relationship between the two bodies: PressBoF was the ultimate paymaster, and the PCC no doubt understood the difficulties inherent in asking for more. In reality, the functional independence of the PCC was restricted by the limited resources which the industry supplied. Here, I am content to adopt Professor Greenslade’s analysis which in my view fairly encapsulates the position:24 “That is the reason I have often referred to the Commission being subject to “string pulling” by its paymasters, the Press Board of Finance (PressBoF). This has been wrongly taken to mean that I was suggesting PressBoF members, or people acting for them, made interventions in individual cases. As far as I’m aware, that never happened, and that indeed was my point: it did not need to happen. The PCC’s chairmen and directors could not be other than aware of the vulnerability of the Commission and of their own positions when attempting to hold their own paymasters to account (and I am deliberately choosing to use a phrase borrowed from the journalistic lexicon about “holding power to account”). They were regulating, or seeming to regulate, the people on whose very existence they depended.”

3.6

3.7

It is also clear to me that the funding made available to the PCC is barely sufficient to enable it to conduct its complaints handling functions effectively. Further, in so limiting the funding available to the PCC, the organisation was unable to exercise other functions that might be properly expected of a regulator, for example, in relation to investigations into industry conduct, and the promotion of standards. Although in submissions to the Inquiry, Lord Black on behalf of PressBoF has disputed that the PCC is under-funded, I recall two other important pieces of evidence in this regard. First, the lack of funding was characterised by Baroness Buscombe as “a fundamental problem…I believe that the industry could have and should have done more to support the PCC in this regard, notwithstanding the sector’s own commercial pressures”.25 She continued:26 “[The PCC’s] performance runs the risk of being compromised because of lack of adequate funding…whilst there has been a real desire on the part of all of us at the PCC to raise our game, a significant lack of resource makes this frankly impossible. The PCC functions because the 16 staff work very long hours and the current director [Stephen Abell] is working and on call 24 hours a day, 7 days a week, as is the Head of Complaints and other staff members. This is simply not sustainable and is not reasonable or sensible given the nature of our work (critical judgment calls made within tight time constraints and its importance to society at large.”

3.8

Second, in June 2010, at the request of PressBoF, the PCC Director Stephen Abell undertook a financial review of the organisation. His conclusions were summarised as follows:27 “The [PCC Business Affairs] Committee, of course, recognises both the financial position of the newspaper and magazine industry and the current economic climate. However, its starting position – having conducted this requested review – is that the

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p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-Roy-Greenslade-ofCity-University.pdf 25 p6, para 38, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-BaronessBuscombe1.pdf 26 pp6-7, paras 39 and 40, ibid 27 p1, paras 3 and 4, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-S11.pdf

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PCC remains considerably underfunded as an organisation. In the last five years, the work of the PCC has increased significantly (in terms of formal complaints made, resolved, ruled upon; in the proactive work and pre-publication work undertaken by the staff; and in the training of working journalists). Scrutiny of the PCC has also increased. In the same five years, the PCC’s funding has not increased in real terms.” 3.9 Although I do not question Lord Black’s evidence in this regard, and Baroness Buscombe’s evidence does not suggest that any specific requests for additional funding were turned down, in my view the issue may turn on properly defining the nature and function of the body under discussion. A body with limited powers would clearly cost less to run than a regulator properly so-called. I do not overlook the fact that the newspaper industry faces very substantial financial pressures and has done for some time. However, notwithstanding those pressures the industry does not give the PCC enough money to carry out the range of roles and functions it needs to. Beyond providing barely enough to allow the PCC to fulfil what is commonly understood to be its primary role, namely to deal with individual complaints, as the supposed regulator for the industry, it has been hamstrung by a critical lack of resource and is unable to fulfil any of the other functions which would normally be expected from a regulator and which the Articles of Association permitted.

Appointments – the Chair
3.10 3.11 The Chair of the PCC is formally appointed by PressBoF, as has been described in Part D Chapter 2. The appointment process has evolved over the period for which the PCC has been in existence. When Lord Wakeham was appointed Chair in 1995 the process was informal; he was simply approached by the then Chair of PressBoF, Sir Harry Roche, and his shoulder was metaphorically tapped.28 For the appointment of Lord Hunt, as more fully discussed below, an independent assessor was involved in the process, as well as involvement by some of the lay members.29 Lord Wakeham identified a number of reasons why he believed that he was considered appropriate for the role of Chair of the PCC, chief among them being that the self-regulatory system was at that point under considerable pressure and the press wanted a candidate who could safeguard that system from what it regarded as the threat of statute:30 “I think the newspaper industry did not want statutory control and that they accepted they needed someone to be the chairman with a bit of clout, who could stop statutory control by getting the standards up to an acceptable level...They wanted someone on side with the government because they did not want statutory regulation.” 3.13 Lord Wakeham also said that “I was regarded as a strong supporter of press freedom and self regulation. It was widely known that I had chaired the Committee that had rejected Calcutt and come down in favour of self regulation.”31 Indeed, he went further and made clear that

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p8, para 30, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Second-Witness-Statement-of-LordWakeham.pdf 29 p511, para 110, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 30 pp15-16, lines 17-13, Lord Wakeham, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-ofMorning-Hearing-15-May-2012.pdf 31 p9, para 31, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Second-Witness-Statement-of-LordWakeham.pdf

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he regarded it as a pre-requisite of anyone being involved in the PCC that he or she should be committed to both these principles.32 This evidence was as frank as it was unsurprising. In this regard, Lord Wakeham did not buck the trend, nor did any of his successors. 3.14 The appointments process has since become more formalised. However, applicants for the post of Chair of the PCC are still required to have broadly similar qualities to those which led to Lord Wakeham being approached. Both Sir Christopher Meyer and Baroness Buscombe were asked in their appointment interviews whether they were supporters of press freedom and believers in self-regulation.33 Indeed, Sir Christopher went to some lengths to make clear his support for the principle of press self-regulation on a number of occasions. In a speech delivered at the beginning of his tenure as the Chair of the PCC, Sir Christopher said that:34 “Liberty and self regulation are inextricably linked. Any infringement of self regulation would not just erode the freedoms of the press. Far more importantly it would curtail the freedoms of the citizen, who in a democratic society will always depend on media uninhibited by both control of the state and deference to the establishment to protect their liberty. That is why self regulation – and all the jagged edges that come with it – must be protected, must be nurtured, and must grow.” Sir Christopher maintained the same view in evidence given to the Inquiry. He said:35 “is self-regulation the only way consistent with maintaining freedom of expression and the press’ status as an exponent of that? The short answer is: yes.” 3.15 In maintaining his position in this way, Sir Christopher appears to be adopting what I consider to be a somewhat remarkable position. First, the equation between liberty and self-regulation – almost as a philosophical position – is in my view simplistic and capable of being overly alarmist. I have explained why this is so in Part B above, and in Part K Chapter 7 below. Second, and perhaps in this context more significantly, these public statements extolling the virtues of self-regulation (coupled in Sir Christopher’s case with equating self-regulation by the PCC with regulation properly so-called) certainly created the impression that the Chair and the industry itself were speaking with one voice on an issue on which they had identical, strong views. It also created the impression that the status quo in what might be called ‘very light’ regulation was acceptable, and that anything else was not. Ultimately, these amounted to the expression of political judgments which might have left complainants asking the not impertinent question: what about the private rights of the individual? Lord Hunt was appointed to Chair of the PCC in October 2011, in succession to Baroness Buscombe who had resigned in July that year. The advertisement for the post had stated that the successful applicant had to be committed to the principles of freedom of the press and of self-regulation,36 and he confirmed that he was wedded to those principles, and explained why. Lord Hunt also confirmed that Lord Wakeham had had some role in persuading him to

3.16

p17, lines 6-12, Lord Wakeham, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-ofMorning-Hearing-15-May-2012.pdf 33 p4, lines 4-16, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Morning-Hearing-31-January-2012.pdf; p35, lines 5-24, Baroness Buscombe, http://www.levesoninquiry.org.uk/wpcontent/uploads/2012/02/Transcript-of-Morning-Hearing-7-February-2012.pdf 34 p2, Sir Christopher Meyer, https://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA%E2%80%93-D8.pdf 35 pp7-8, lines 24-2, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Morning-Hearing-31-January-2012.pdf 36 p59, lines 1-5, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of-AfternoonHearing-31-January-2012.pdf

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put his hat in the ring,37 notwithstanding that recruitment consultants were also involved in the process. 3.17 Exactly what happened is somewhat opaque. Despite an on-going process of reform, the appointment process appears to be neither transparent nor impartial. Whilst it is not unexpected that candidates might be canvassed as to their views on self-regulation and expected to support the principles of self-regulation, at the very least the appointments process risked giving rise to the perception that the Chair was beholden to the regulated industry. Further, it is clear that Lord Hunt is the last in a line of PCC Chairs who appears to have regarded freedom of the press, particularly as defined in the Editors’ Code of Practice and self-regulation, as synonymous.

Appointment of other members of the PCC
3.18 Lay members of the PCC are also required to be committed to the principles of self-regulation and the freedom of the press. This appears also to have meant that, above all else, they too should be supportive of the idea of freedom of expression or press freedom as set out in the Editors’ Code of Practice.38 In his interview to become a PCC Commissioner Lord Grade recalled that he was asked whether or not he supported statutory regulation.39 However, it has recently been pointed out by His Honour Jeremy Roberts QC (formerly a distinguished criminal judge) and others that the Inquiry may have received an unbalanced perspective on this point. For example, he recalls that Mr Abell asked him a question at his interview about the balance between Article 8 and Article 10 rights, and Lord Grade now recalls that he was also asked a similar question. Whilst acknowledging this point, it is, however, clear that, an a priori commitment to the principles of self-regulation amounted in practice to a commitment to the system of selfregulation through the PCC. Having heard some evidence as to the very different individuals who comprise the lay members of the PCC (which I touch on below), it is nevertheless clear that those individuals were all recruited from a narrow class of people already committed to the principle of self-regulation by the industry and, effectively, in the form that it existed, that is to say, to the preservation of the status quo.

3.19

Serving editors on the PCC
3.20 Newspaper editors currently in post serve on the PCC, albeit as a minority. This raises at the very least the appearance of bias, creating the concern that the industry was ‘marking its own homework’. While editors do not take part in discussions on complaints relating to their own newspapers, or newspapers from the same group, they have and may be seen to have a commonality of interests in directing the overall analysis of the balance between freedom to publish and the rights of third parties in a manner which might overly protect the former over the latter and may not place sufficient restrictions on press behaviour, or at least create the perception of so doing.

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p61, ibid p1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/SA-B35.pdf 39 p33, lines 5-12, Lord Grade, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofAfternoon-Hearing-31-January-2012.pdf

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3.21

It has been suggested that, since editors are in a minority on the PCC, their presence does not in fact threaten the independence of PCC decision-making.40 I record that this suggestion was also reinforced in the submission received from His Honour Jeremy Roberts QC, supported by the evidence of his lay commissioner colleagues. I understand and respect the points that have been made, and return to them below, and should not be interpreted as saying that individual lay commissioners have failed in their duty. Rather, the stand out issue is about systems and independence of decision-making viewed in the round. On that basis alone, I am unable to accept this argument for a number of reasons. First, even if not a majority, the editors formed a substantial bloc within the PCC who, by dint of their experience and practical knowledge of the industry, would be likely to exercise a disproportionate influence. Even if that is not so, at the very least, this would be how reasonable observers would view the matter. These influences would undeniably be mitigated if the industry had chosen to populate the PCC with more former editors, serving journalists and NUJ members, likely to inject a more independent-minded approach. Instead, expert industry knowledge was concentrated in the hands of editors only. Second, the PCC operates a principle of abiding by precedent, looking to previous decisions for guidance when deciding cases and seeking to keep decisions consistent.41 Key decisions are collated in the Editors’ Codebook, an amplified version of the Editors’ Code of Practice. A decision in one case would determine or at least influence the approach taken by the PCC in a similar case in future.42 Although unexceptional when viewed in isolation from all other considerations, this state of affairs far from eliminates the conflict of interest which is acknowledged by editors leaving the room when their own newspaper or a sister paper is being discussed. An awareness that an adjudication in the instant case might well impact on the application of the Code to a future case, in which the adjudicating editor’s own title might be involved, creates an inherent conflict between the interests of serving editors and doing of full justice to the complaint and the person who made it. This is not a practice shared by other regulators and with good reason. Ofcom, charged with the different but (for these purposes) comparable task of regulating the broadcast media industry, does not have anyone currently active in the industry on the board which adjudicates on breaches of the Broadcasting Code. The Chair of Ofcom, Dr Collette Bowe, described the structure of Ofcom in the following way:43 “the board member who leads the work on the enforcement of standards in broadcasting is himself a well-known, very distinguished broadcast journalist, formerly of the BBC and then of Channel 4, who brings a large amount of experience to that role, but we do not regard it as appropriate to have people who are engaged very actively in the industry as members of the board. Q. Why is that?

3.22

3.23

3.24

p54, para 120, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf; p4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-Sir-ChristopherMeyer.pdf; p17, lines 4-8, Paul Dacre, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcriptof-Afternoon-Hearing-6-February-20121.pdf; pp86-87, lines 25-29, Tina Weaver, http://www.levesoninquiry.org.uk/ wp-content/uploads/2012/01/Transcript-of-Morning-Hearing-16-January-2012.pdf 41 Not quite equivalent to the legal doctrine of stare decisis which is more rigidly applied 42 pp 99-153, para 239, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf 43 p61, lines 3-14, Dr Collette Bowe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-ofMorning-Hearing-1-February-2012.pdf

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DR BOWE: Because of conflicts. I’m sure you’re familiar with the sorts of issues that arise, and you can manage small conflicts on boards; you can’t manage large, endemic ones.” 3.25 I recognise that PCC witnesses gave evidence (which I entirely accept) that the lay or public members of the PCC are independently-minded, often strong-willed individuals who are not intimidated by the presence of editors:44 “I think if you look at the list of people who served on the Commission, it’s an impressive list of people who have either spent a life in public service or politics…they’ve excelled in their field in one way or another. These aren’t patsies at all. Obviously, I was in every single Commission meeting whilst I was director and there would be some excellent knock-about debates. So these weren’t people who were in any way cowed by the presence of a few editors.” 3.26 Lord Grade was also asked for his perspective on this point. His answer should be set out in full.45 “I’ve never experienced that. I must have attended now eight or nine meetings. Where a case is going against a newspaper, where the recommendation of the officers is that there’s been a clear breach of the code – such-and-such a clause in the code, the editorial figures on the board, who are in a minority, are the first to speak out in condemnation and say, “I can’t believe they did that, that was a –” you know, it’s a very, very honest debate. A very, very honest debate. Anybody with an interest, obviously, leaves the room at that point, if they’re part of a group and it’s one of their newspapers in the group, whether it’s a local newspaper or national newspaper. No, the debates are very, very, very fair. There are debates about the wording and quite often – I can’t think of an example at the moment because we get papers that thick every week (indicates). There are examples where editorial figures around that table have strengthened the criticism in the adjudication. So I don’t have any issue in that regard whatsoever, and I wouldn’t – personally speaking, I wouldn’t be there if that was the case. I wouldn’t stay there if that was the case.” 3.27 I also expressly record that Tim Toulmin rejected the criticism that there were no representatives of the victims of press intrusion on the PCC, saying that “people who work at the PCC, whether they’re on the board or full time staff, are motivated by trying to assist people who are having difficulties with the press, particularly those vulnerable people who can’t afford a lawyer and so on.”46 It may well be unnecessary, if not inappropriate, to ensure that one or more lay Commissioners should have had experience of having suffered at the hands of press intrusion, since individuals in this category might be expected to be biased the other way, or at least give rise to that appearance.47 Even so, without doubting the truth of Lord Grade’s evidence as to the full and frank exchange of views which attends the deliberations on the PCC’s adjudications in individual cases, I do not believe that it really addresses the structural problems I have

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p42, lines 16-25, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-30-January-2012.pdf 45 p47, line 17, p48, line 14, Lord Grade, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Afternoon-Hearing-31-January-2012.pdf 46 p44, lines 21-25, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-30-January-2012.pdf 47 I acknowledge that three of the lay commissioners have recently submitted evidence that they or their families had in the past been the subject of press attention. However, there has been no suggestion that they were the subject of the kind of intrusive reporting which has proved most damaging to victims; and which the PCC failed to tackle

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identified. Lord Grade’s evidence would fail to persuade those who reasonably believe that the system is inherently weighted in favour of the status quo. Neither is this point to doubt the real value that I am sure lay Commissioners have brought to the process. 3.29 Refreshingly, some representatives of the press have accepted that the presence of serving editors on the PCC compromises its independence. For example, the editor of the Financial Times, Lionel Barber, was of the view that the PCC had traditionally contained too many serving editors:48 “It’s not a tenable position. We need outsiders. There have been some changes, but certainly for too long the PCC was dominated by insiders.” 3.30 I am not suggesting for one moment that the PCC should have been free from all industry expertise: on the contrary, this always would have been, and is, invaluable. But industry expertise should have been drawn from a broader cohort and should not have been taken from serving editors of large national titles in competition with other national titles at all.49 I have already said that serving or former journalists (including NUJ members) and retired editors would add a different perspective to the PCC board.50 I do not accept the argument that retired editors would necessarily be out of touch with developments in the industry.51 The broadcast media industry has, over the past 20 years, changed with extraordinary speed. The rise of the internet and media convergence has impacted upon broadcasters as well as newspapers. In spite of this, Ofcom has successfully employed the expertise of former journalists and media executives on its Board.52 There is no suggestion that those people have failed to understand or account for the acute changes and associated challenges which have affected the broadcast media. I emphasise that this is not to seek to compare the PCC with Ofcom or to hold one up against the other: it is simply to make the point that similar issues fall to be considered without the absence of serving editors being considered a disadvantage, still less an impediment. In my view, the constitution of the PCC Board is a limit on its independence. Serving editors, however dedicated to their role, are parti pris in relation to the outcome of adjudications in the sense I have identified, and are capable of influencing both the agenda and the course of debate in individual instances. Additionally, but outside the context of individual adjudications, the system is such that it creates at least the perception that the most powerful individuals on the PCC will direct overall strategy, policy and direction. Alastair Campbell put the point in this way:53

3.31

3.32

pp48-49, lines 25-2, Lionel Barber, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-10-January-2012.pdf 49 The example is often given of doctors serving on Disciplinary Committees of the General Medical Council. If an ENT surgeon from, say, Newcastle, sits on a Disciplinary Committee in respect of an ENT surgeon whom he does not know and has had no contact with from, say, London, he will be able to bring his expertise to bear in a completely impartial way. If one of a dozen or so national editors sits on a PCC panel in relation to a competitive title, it is almost inevitable that he or she will know the editor extremely well and is likely to have a view about the balance of Articles 8 and 10: a complainant may well not feel that such an editor could be entirely impartial. As appears from the analysis of the position of Northern and Shell, the converse might also be true 50 p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-Michelle-Stanistreet.pdf 51 p90, lines 1-10, Tina Weaver, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-16-January-2012.pdf; p42, lines 17-23, Stephen Abell, http://www.levesoninquiry.org.uk/wpcontent/uploads/2012/01/Transcript-of-Afternoon-Hearing-30-January-2012.pdf 52 pp101-102, lines 7-9, Ed Richards, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-12-July-2012.pdf 53 p26, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Witness-Statement-of-Alastair-Campbell.pdf

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“When I was in Downing Street, I was constantly told by PCC people that the three people who ’counted’ there were the chairman, Les Hinton and Paul Dacre.” 3.33 I have no reason to doubt that this is what Mr Campbell was told by the ‘PCC people’ his witness statement admittedly did not identify. Whether or not they were speaking authoritatively, or accurately, perhaps does not matter; the concern is the perception which arises from the possibility for real power to be concentrated in a few hands.

The makeup of the Editors’ Code of Practice Committee
3.34 The Editors’ Code of Practice Committee, formally a sub-Committee of PressBoF rather than of the PCC, is responsible for the promulgation of the terms of the Editors’ Code of Practice. A list of the current members of the Editors’ Code of Practice Committee is given in the witness statement of Stephen Abell.54 It wholly comprises serving editors and executives. The PCC has been able to communicate its views on any amendments to the Editors’ Code of Practice, through the Chair or the Director. Although the formal role of the PCC Chair and Commissioners in relation to the Editors’ Code of Practice is advisory only, it has in practice been persuasive. One occasion when views were communicated was in the aftermath of the death of Diana, Princess of Wales. Lord Wakeham gave evidence that:55 “I persuaded the newspaper industry to strengthen its Code of Practice several times, including a wholesale revision, particularly on matters relating to privacy, following the death of the Princess of Wales in 1997.” 3.36 The Inquiry has also heard evidence that the PCC itself (through the Director or the Chair) was involved in feeding back ideas for improvements to the Editors’ Code from the coalface to the Editors’ Code Committee. There are examples of this in the documentation which the PCC has provided to the Inquiry. One such is a letter from Sir Christopher Meyer to Les Hinton, then Chairman of the Editors’ Code Committee, recommending improvements to clause 6 of the Editors’ Code.56 On other occasions, comments on the Editors’ Code from external contributors were fed into the Editors’ Code Committee’s considerations.57 Public involvement in the contents of the Editors’ Code was, however, more limited and restricted to an annual consultation session undertaken by the Editors’ Code of Practice Committee. Beyond this and the limited role of the PCC, control over the Code was held entirely by the editors serving on the Code Committee. In contrast, although a statutory code (which I do not recommend) as a matter of pure structure, it is significant that the Broadcasting Code is drafted by Ofcom employees and approved by the Content Board, under delegated authority from the Ofcom Board. Suggestions are fed into Ofcom by stakeholders in the industry so that the Broadcasting Code develops in consultation with the industry and accounts for changing practices and industry challenges. Ed Richards, the Chief Executive of Ofcom, described the development of the Broadcasting Code in the following way:58

3.35

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3.38

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p235, para 350, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 55 pp1-2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Lord-Wakeham-Letter-to-Inquiry.pdf 56 pp1-2, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-M7.pdf 57 p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T278.pdf 58 pp91-92, lines 1-11, Ed Richards, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-ofMorning-Hearing-1-February-2012.pdf

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“…the way the code would work is so we review it from time to time… we try and update it in the light of practice. It would be drafted by full-time Ofcom employees, and it would then go through our decision-making process for approval, and in this case would be approved by our content board, which is where the hub of our broadcasting expertise lies. It could always, as with any Ofcom decision, be then referred upwards to the main board, but as I recall, I think this [current edition] would have been signed off by the content board in their delegated responsibilities. DR BOWE: Yes. LORD JUSTICE LEVESON: Have you found it necessary … to involve actual programme makers or editors in the creation of this document? MR RICHARDS: I would say that they are involved very closely in its evolution. We have a very close dialogue with actual programme makers, actual journalists, currently practising but also those for whom we can –those who we can draw on who are no longer practising but still have a deep well of expertise, and we draw on that very heavily. So just to underline the point, what does not happen is that half a dozen people in Ofcom hide in a room and write a code. What actually happens is that those people talk on an open way over an extended period, test ideas, examine them, review them, and that process would involve working journalists, working producers, working editors, as well as those of – with previous experience, but the decision on the code would then be ours, and the decision would be made by the content board, so it’s incorporating, understanding latest practice and things of that nature, but the decision absolutely remains with us.” 3.39 It is a clear flaw in the self-regulatory system that the Editors’ Code of Practice Committee, the body with sole authority to amend the Editors’ Code of Practice, is made up exclusively of serving editors and executives. This gives rise to at least the perception that rules are being made which suit the editors themselves and not the public. Of course, as Mr Richards pointed out, a deep well of expertise is obviously necessary but what is also required is the involvement of a broader range of opinion to reflect all relevant constituencies.

Evidence of Northern and Shell witnesses
3.40 Witnesses from Northern & Shell gave evidence of their impression that the PCC was run by and for the benefit of a particular section of the press; this they gave as the principal reason for the January 2011 departure:59 “…we came into it seeing the sense in a self-regulated press, and we thought to ourselves we were able to regulate ourselves. There are a very large number of very good reasons why a newspaper would want to regulate itself, even without any industry body. We’d been used to doing that on magazines, so we knew of an Editors’ Code, and we saw no reason, in principle, why a company in isolation might not apply that Editors’ Code and put in its own disciplines and constraints. The difference was the same code was being enforced, but it was a kind of an industry body that – it was a club.” 3.41 Underlying this answer may be both an element of special pleading and of personal acrimony between those at the head of Northern & Shell and those who they perceive as running

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this ‘club’. From their perspective, the PCC was too close to one or more sections of the press, and Northern & Shell was relegated to the sidelines. I would not wish to comment on whether this perception articulated by Paul Ashford is substantiated, but its very existence does bear on the general issue of independence, the lack of which, and in particular from certain sections of the press, was also the reason given by Ian Hislop for Private Eye’s refusal to join the system of self-regulation in the first place.60

4. The alignment with industry
4.1 In this section I look at the willingness of the Press Complaints Commission, as putative regulator, to align its interests directly with those of the industry. At times, it seems that the PCC acted as both advocate and champion for this industry, a role that it rarely adopted in relation to those who had been wronged by the press. I will also examine and comment on the response of the PCC in response to criticism and its attitude towards the improvement of its structures and functions as well as calls from outside the industry for reform.

Advocacy of press industry interests
4.2 On occasion, the PCC acted as an unabashed advocate or lobbyist for the press industry. Some of this advocacy was directly in the commercial interests of the press. On other occasions, the PCC advanced the case for the self-regulatory system itself. Promoting self-regulation in principle, and the self-regulatory system as it was established in practice, may have created less obvious difficulties of perception than the promotion of the commercial interests of the regulated industry. However, as the preservation of the status quo was in at least the short term interests of the industry, promotion of the merits of self-regulation was an advancement of that interest. In my view, this served to create a real conflict of interest between the core function of the PCC, applying the Code and achieving a balance between the interests of the subjects of stories and the press, and the role it arrogated to itself in advocating the interests of the industry as a whole. As has been make clear in earlier sections of the Report, in particular Part I Chapter 5 section 3, Lord Wakeham intervened to influence the content of the Human Rights Act 1998 (HRA), negotiating with the then Home Secretary the Rt Hon Jack Straw MP for the inclusion of section 12 in aid of the press.61 Lord Wakeham was clear in his evidence that he “never acted as a ‘representative of the press’”.62 He viewed himself instead as the representative of self-regulation, which he believed would be undermined by the passage of the HRA.63 However, he acknowledged in evidence that, while his primary concern was to protect the self-regulatory system, he “did in [his] speeches make some more general observations about press freedom”.64 Lord Wakeham also acknowledged that representatives of the press,

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pp4-5, paras 12 - 13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-IanHislop.pdf 61 p3, para 12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Witness-Statement-of-Lord-Wakeham. pdf; p12, paras 103-109, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Witness-Statement-of-JackStraw-MP.pdf 62 p14, para 45, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Second-Witness-Statement-of-LordWakeham.pdf 63 p15, para 45, ibid; pp46-47, lines 3-13, Lord Wakeham, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/05/Transcript-of-Morning-Hearing-15-May-2012.pdf 64 p16, para 48, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Second-Witness-Statement-of-LordWakeham.pdf

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including the then Chair of the Editors’ Code of Practice Committee, Sir David English, also lobbied the Government in relation to the HRA.65 4.4 Lord Wakeham outlined his reservations about the effect of the Human Rights Bill on the press in two speeches to the House of Lords. He set out his concern in a speech on 24 November 1997 thus:66 “The Bill as drafted would damage the freedom of the press and badly wound the system of tough and effective self regulation that we have built up to provide quick remedies without cost for ordinary citizens. It would inevitably produce a privacy law, despite the Government’s stated opposition to one” 4.5 The Rt Hon Tony Blair gave evidence to the Inquiry of the lobbying undertaken by Lord Wakeham and the PCC more broadly intended to make plain the detrimental impact of the HRA on the press:67 “Q. …The Human Rights Act, Mr Blair…Was it the position that News International – I suppose together with everybody else – were lobbying for complete press immunity from the Human Rights Act? A. Yes, that’s right. They wanted no suggestion that you would move outside the bounds of the PCC and self-regulation. Q. And were you generally supportive of that position? A. Yes, that was … my view was that if you were to deal with this, you had to deal with it head on, as it were, not through the Human Rights Act, which would be a sort of side way of dealing with it. Also, at that time, I think I’m right in saying it was Lord Wakeham who was head of the PCC, who was something actually I thought was doing quite a good job of that, and the PCC were pretty fierce on this, on behalf the whole of the media, really, not any one particular part of it.” 4.6 Initially, this lobbying was intended to convince the Government to grant the press an exemption from the HRA.68 The Government was, however, according to Lord Smith of Finsbury, “fundamentally opposed” to any such exemption.69 In the event, the solution, negotiated by Lord Wakeham,70 between the press and the Government was described by Lord Smith thus:71 “In June of 1998, agreement was reached across government – and welcomed by the PCC – that a new clause would be brought forward for the Human Rights Bill: giving a steer on the need to respect the media’s right to freedom of expression as well as individuals’ rights to privacy; requiring the courts to have regard to the PCC Code of Practice and the broadcasting codes; and making it more difficult to obtain injunctions restraining publication”.
65 66

p15, para 47, ibid p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Lord-Wakeham-Exhibit-E.pdf 67 pp95-97, lines 23-2, Tony Blair, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-ofMorning-Hearing-28-May-2012.pdf 68 pp4 – 5, para 17, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Witness-Statement-of-LordSmith.pdf 69 ibid 70 p45, lines 11-20, Lord Wakeham, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-ofMorning-Hearing-15-May-2012.pdf 71 p5, para 1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Witness-Statement-of-Lord-Smith.pdf

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4.7

The compromise reached was the insertion of what was to become section 12 HRA. Lord Wakeham described this as “the best compromise that was likely to have been achieved in the circumstances. It tried to tackle the issue of prior restraint and, in Jack Straw’s phrase in the House of Commons, ‘preserve[d] self regulation’”.72 The Human Rights Bill was not the only contemporaneous legislative matter to alarm the industry. Proposals in the Data Protection Bill were also a cause for concern. Lord Wakeham linked the two in a speech:73 “The thing that puzzles me is that the Data Protection Bill and the Human Rights Bill which this House has been considering seem to exist almost in different worlds, but the truth is that they present two entirely contradictory sets of policies. The data protection bill does not introduce new powers for the rich and famous; the human rights bill does the opposite. The data protection bill does not introduce a back door privacy regime; the human rights bill does. The data protection bill safeguards the position of self-regulation. The human rights bill may end up undermining it.”

4.8

4.9

The substance of Lord Wakeham’s objections here demonstrates the difficulty in distinguishing the interests of the press and the interests of self-regulation. I have no doubt that Lord Wakeham, in lobbying the Home Secretary and other Ministers, believed that he was working in the interests of the self-regulatory system. However, Lord Wakeham’s interventions were couched not only in terms of protecting self-regulatory structures but also included warnings about the danger to the freedom of the press. Lord Wakeham was not by any means the only leading member of the PCC to have been adept at the lobbying and influencing of politicians. When Guy (now Lord) Black resigned as Director of the PCC, Sir Christopher Meyer praised him for his skill in helping to influence Government policy in the interests of the self-regulatory system. In particular, Sir Christopher made reference to the role played by Lord Black in mitigating the impact of a number of pieces of legislation and for helping secure a benign political environment for self-regulation:74 “Since 1996 he has helped protect self regulation from the threats posed by numerous pieces of legislation including the Human Rights, Data Protection and Youth Justice Acts. And by making the PCC the efficient and effective body that it is today, Guy can rightly claim credit for the generally benevolent political attitude towards selfregulation that we currently enjoy”.

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The PCC actively sought to combat what it perceived as threats to the self-regulatory system. The 2003 Annual Report of the PCC set out the ‘external threats’ facing the Commission. These included: discussions with European officials “to protect the special position of selfregulation in the UK”,75 as well as proposals for amendment of the Communications Bill, which could have brought the PCC under the supervision of Ofcom, and Irish legislators’ “plans to introduce a statutory press council there”.76 The PCC was particularly concerned at the potential impacts of proposals brought forward by the European Commission,77 and went so far as to engage a Brussels-based political consultant “to act, among other things, as an

p15, para 47, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Second-Witness-Statement-of-LordWakeham.pdf 73 HL Hansard, Series 6, Vol 305, Col 463, http://www.publications.parliament.uk/pa/ld199798/ldhansrd/vo980202/ text/80202-09.htm 74 p2, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E1.pdf 75 ibid 76 ibid 77 PCC, http://www.pcc.org.uk/news/index.html?article=Mzk

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early warning system, and to persuade opinion formers and legislators there of the merits of self-regulation.”78 4.12 In 2005, the PCC coordinated with PressBoF to lobby in Europe against the effect of the proposed Television Without Frontiers Directive. The then Director of the PCC, Tim Toulmin, wrote to the Secretary of PressBoF in the following terms:79 “My understanding is that the specific danger in the draft Directive is in its expectation that there will be regulations to ensure that:

• • •

there is a (statutory) right of reply to inaccuracies; audio-visual material is not distributed in such a way that might seriously impair the physical, mental or moral development of minors; and audio-visual information does not contain incitement to hatred on the grounds of sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation. “Incitement to hatred” is not defined.

These areas clearly touch on editorial content, particularly the first and third points, but the consultation papers only suggest explicitly that the second of these could be dealt with through self-regulation. Worryingly, the relevant paper states that in relation to the proposed rules on discrimination, “some stakeholders argued that co-regulation or self-regulation would be inappropriate”, and there is no further suggestion that self-regulation would be adequate. The broader danger, of course, is that unless these areas are carved out for selfregulation, the Directive will effectively have been a Trojan horse, with the regulation of at least some part of newspapers’ and magazines’ websites becoming for the first time the responsibility of other agencies (probably Ofcom). It can only be a matter of time before this precedent is used to argue for the harmonisation of regulation of broadcasters’ and publishers’ websites as media convergence continues. Ofcom, incidentally, assures us that it has no ‘imperial’ ambitions in this area, and the government appears to have taken a strong position against having to regulate the editorial content of websites – although it may of course have no choice eventually”. 4.13 Mr Toulmin’s letter is instructive. It is clear that the PCC was working with PressBoF to try to combat a perceived threat not only to the self-regulatory system but also more significantly to editorial freedom. It demonstrates that the PCC sought to influence legislation in a way which favoured the interests of the industry. The PCC adopted a similar advocatory role in relation to discussions concerning the introduction of custodial sentences for breach of s55 of the Data Protection Act. On this occasion, it was Sir Christopher Meyer who would play the lead role. Sir Christopher gave evidence that he could not recall any conversations with editors or other representatives of the press industry about the issue.80 However, he said that he thought it was appropriate for the PCC to campaign on this issue because “…it was something that we thought would be pretty chilling to freedom of expression”.81 In addition:82

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78 79

PCC, http://www.pcc.org.uk/news/index.html?article=Mzk PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-S21.pdf 80 p61, lines 4-21, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Morning-Hearing-31-January-2012.pdf 81 pp61-62, lines 24-1, ibid 82 p63, lines 11-23, ibid

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“It was something I believed in, and if you think Mr Dacre picked up the phone one day and said…“Very helpful if you stick in the annual review something about Section 55” – forget it. Even Jack Straw was on his side as well … and the Information Commissioner was rebuffed by the Lord Chancellor. So it was not as if I was expressing some astonishing view. There was very wide public debate about this, and we decided to take part in it and why the hell not?” 4.15 Whether or not there were conversations between Sir Christopher and representatives of the press industry about the issue of custodial sentences for breach of s55 of the Data Protection Act, his action in respect of this issue on behalf of the organisation he chaired demonstrates that PCC thinking and priorities were very close (if not identical) to those of the industry it was supposed to regulate. Little consideration appears to have been given to those who might be the subject of intrusive breaches of data protection at the hands of the press without there being the slightest public interest in such breaches. Yet it is the complaints of those people which the PCC exists to mediate or resolve. It is not clear to me why the PCC thought it either necessary or appropriate to lobby Government on behalf of the press; it is not as if the press was devoid of its own powerful advocates. It is apparent from Sir Christopher’s evidence that the impulse to intervene stemmed from a prior belief that the principle of press freedom was at stake; and that this principle was something the PCC had a role in defending. I do not question the genuineness of Sir Christopher’s belief, although I have raised elsewhere my concerns as to whether it was well-founded. The point remains that in picking up the proverbial megaphone in this way, Sir Christopher was in danger of undermining public confidence in the ability or willingness of the PCC to act as an impartial and independent regulator through the clear alignment of the PCC with the interests of the industry.

4.16

Protective function of the PCC
4.17 There appears to have been a belief among some sections of the press that one of the functions of the PCC was to act as a shield protecting the press from criticism and litigation. The former editor of the Daily Express, Peter Hill, assigned as one of the main reasons for Northern & Shell’s decision to leave the PCC as the fact that the latter no longer prevented complainants from claiming through the courts. In 2009, Sir Christopher Meyer wrote to Richard Desmond in an attempt to persuade the Northern and Shell group to remain in the self-regulatory system. He wrote:83 “…now that the Express has withdrawn from the NPA, it would be helpful to talk about how we can keep the papers within the PCC system. The benefits to newspapers of subscribing to the scheme are numerous: sorting out complaints through us (particularly about privacy matters) minimises the risk of cripplingly expensive court cases and legal settlements; it delivers opt-outs for journalists from numerous pieces of legislation such as the Investment Recommendation Regulations; and it keeps the government from legislating on the areas that the press Code of Practice covers. In fact, last year – when the public used our services in record numbers – the Government, Opposition and the Select Committee for Culture, Media and Sport all came out in favour of self-regulation. I know that the subscription to the PCC is not cheap – around £167k per annum – but I strongly believe that the costs of staying outside the system, particularly in legal fees, would be much higher.”
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p1, Press Board of Finance, https://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Exhibit-Pbof-55.pdf

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4.19

In a similar vein, the 2010 financial review (drafted by the then Director of the PCC, Stephen Abell) made the following observation:84 “A successful PCC is, as everyone recognises, in the interests of the industry, both in terms of staving off statutory regulation and limiting the flow of people to use the courts. The better the service the PCC can offer, the better value it is to the industry.”

4.20

The maintenance of the system of self-regulation through the PCC and, therefore by implication, the ability of the PCC to shield the industry from litigation, was often cited by the PCC as a reason for newspapers to comply with PCC adjudications and decisions. Sir Christopher wrote in February 2007 to Colin Myler, then the editor of the NoTW, to arraign Mr Myler for not having given sufficient prominence to a PCC adjudication. Sir Christopher wrote: “I was particularly surprised at this oversight given the current context of renewed scrutiny of self-regulation”.85 The implication of this is clear: failure to comply with PCC decisions risked questions being asked of the self-regulatory system itself.

A pattern of cosmetic reform
4.21 In other parts of this Report, most particularly in Part D Chapter 1, I fully address the history of press self-regulation. As I said on several occasions during the oral sessions this has been characterised by a cyclical pattern of (i) crisis, (ii) the press coming under heavy public and some political pressure, (iii) some reforms, usually of a limited nature, being carried out, (iv) ephemeral improvement, (v) deterioration in press behaviour, and ultimately (vi) another crisis. As I made clear above,86 the reforms introduced by the industry have not addressed the structural problems which this Part of the Report serves to identify. Put another way, limited programmes of reform have been concerned with relieving pressure on the press, and blunting calls for strengthening the self-regulatory system. A show of reform has been used as a substitute for the reality of it. Part D Chapter 1 looked at the history of self-regulation until 2003 which was when Sir Christopher Meyer took over as Chair of the PCC. I will therefore pick up the narrative from then. In a speech delivered on 6 May 2003, approximately six weeks into his tenure as Chair, Sir Christopher announced a programme of reform which he described as “permanent evolution”.87 It was intended as a process of self-examination and improvement with a view to providing a better service to the public that would be applied not only to the PCC but the self-regulatory structure more broadly.88 The first measures introduced as part of the ‘permanent evolution’ programme related to the independence of the Commission itself. The number of public members of the Commission was increased to ten (from nine) against seven editorial members.89 Also, the recruitment process for public members was changed so that positions were advertised, and prospective members were interviewed by an independent panel before the final interview with Sir Christopher and another member of the PCC.

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p1, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-S11.pdf p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T180.pdf 86 Part D, Chapter 1 87 pp1-9, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-–-D8.pdf 88 pp42-44, para 86, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 89 p11, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E1.pdf

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4.25

As I noted earlier, the fact that lay members formed a majority on the Commission has been repeatedly relied upon by the PCC and its supporters as evidence of the independence of the self-regulatory system from the industry. Putting one more lay member on the Commission appears to be a step towards achieving greater independence for the decision-making body, but it was far from being a radical one; the positive impact, if any, is far from clear. This was very much more a cosmetic move towards independence than a substantive one. The programme of ‘permanent evolution’ also saw the introduction of the Charter Commissioner and the Charter Compliance panel. In the PCC’s 2004 Annual Report, the role of the Charter Commissioner was described as providing “an internal ‘judicial review’ mechanism”.90 This is not a helpful or accurate description. The Charter Commissioner and Charter Compliance Panel did not have the power to overturn PCC decisions. They did not examine whether decisions of the PCC were reasonable, even in the rather more limited sense permitted by judicial review. Rather, they examined whether the PCC’s service standards met their targets; if the review found a procedural defect, it could ask the PCC to revisit a decision.91 What these two bodies offered was effectively an enhanced customer-service complaints body and nothing more. To imply, by describing the powers of the Charter Commissioner and Charter Compliance Panel in the language of judicial review, that they had any more substantial function, or offered the reassurance of oversight of the PCC’s activities, is entirely wrong; they were little more than window-dressing.92 Taken as a whole, the package of reforms introduced under Sir Christopher’s ‘permanent evolution’ did not address, and were not intended to address, the substantive problems with the system of self-regulation. These limited reforms may well have given the appearance of activity and development but did little more than that. Nor did the PCC move to address in any meaningful sense the concerns raised by revelations of mobile phone voicemail hacking by journalists working at the NoTW in 2006. Following the completion of the PCC’s Report into Subterfuge and Newsgathering in May 2007 (dealt with in more detail below), the PCC made recommendations to newspapers about steps they might take in order to comply with the existing rules in relation to data protection, subterfuge and news gathering.93 In August 2007, Clause 10 of the Editors’ Code of Practice (relating to subterfuge and newsgathering) was revised to prohibit the unauthorised removal of documents or photographs and the accessing of digitally-held private information without consent. In addition, Clause 10(ii) was changed so that the provisions in relation to public interest justifications for subterfuge and misrepresentations extended to the activities of third parties.94 When she took over as the Chair of the PCC, Baroness Buscombe planned an independent review of the PCC’s governance, remit, sanctions, budget and the degree of independence it enjoyed from the industry.95 This became the Independent Governance Review, which was

4.26

4.27

4.28

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p7, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E2.pdf; p11, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E1.pdf 91 pp67-68, paras 164-169, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf 92 So that there is no doubt about the matter, I do not in any sense criticise the way in which the Charter Commissioner and Charter Compliance Panel went about the work: my concern is the limit of their power and responsibility 93 p275, para 425, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 94 p244, para 356, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 95 p4, paragraph 21, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-BaronessBuscombe1.pdf

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set up in August 2009 and reported in July 2010. Despite the planned scope of the project, the governance review which followed was altogether more limited in its scope:96 “…the industry was very clear that a review undertaken by the PCC should only consider issues solely within its remit. Questions as to funding, independence and sanctions were decidedly off limits”. 4.30 The Independent Governance Review made 75 separate recommendations. According to Stephen Abell, former Director of the PCC, the key reforms which eventuated principally comprised:97 “A proper statement of aims and duties were to be published by the PCC; An enhanced register of interests would be published to inform the public of any conflicts of interest which Commissioners might have; A public commissioner would be appointed Deputy Chairman of the PCC; New performance objectives would be introduced to measure the success of the PCC’s work; A new website would be launched to improve access to complaint statistics, PCC case law and complaint-making facilities; Commissioners would be updated weekly on the day-to-day activities of the PCC’s staff; and The PCC would establish working groups to consider questions arising from public concern or complaint trends.” 4.31 Other recommendations included changing the name of the Charter Commissioner and Charter Compliance Panel to the Independent Reviewer and Review Panel respectively.98 None of these changes addressed the fundamental weaknesses of the self-regulatory system. Nor did the reforms make the PCC, or the wider self-regulatory system, more independent of the press. There were limited moves towards further independence, manifest in the greater involvement of the lay members of the PCC in the appointments process, but given the real constraints on of the independence of the PCC set out at the head of this Chapter, the effect of this was negligible and served only to allow the impression that a process of reform was underway. I deal with the substantive detail of the PCC’s investigations into phone hacking elsewhere in this Chapter. However, there is value, in the context of the limited and partial attempts at reform made by the PCC, in making some comments about its response to the allegations. Baroness Buscombe gave evidence that she felt pressure to launch an investigation into allegations of phone hacking at the NoTW in 2009 in order to reassure the public that something was being done by the regulator.99 It may be that the PCC’s general approach to the public presentation of itself owed much to the bonds which Baroness Buscombe identified in this instance.

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ibid pp47-48, paras 99-102, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf 98 pp 67-69, paras 164-174, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf 99 pp50-51, lines 14-21, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ Transcript-of-Morning-Hearing-7-February-2012.pdf
97

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4.33

It was only following the sustained public outcry in response to continued revelations of phone hacking that the PCC announced that it intended to address the fundamental weaknesses in self-regulatory system. In a press release published on 6 July 2011, after the Guardian had published its article alleging that Milly Dowler’s phone messages had been hacked, the PCC announced a review of self-regulation to be carried out by lay members of the Commission. The remit was to:100 “[a] review of all aspects of press regulation in its current form, which will be designed to ensure that public confidence is enhanced. The Commission will wish to review its own constitution and funding arrangements, the range of sanctions available to it, and its practical independence.”

4.34 4.35

The proposal is in marked contrast to previous efforts at self-reflection, which had failed to ask pertinent questions about self-regulation and had led only to cosmetic changes. The self-presentation of the PCC as a competent regulator with adequate powers perpetuated the unsatisfactory status quo. The PCC gave the public a false impression of what it could do and never acknowledged the limitations of its powers. Through acquiescent silence, the PCC permitted policy-makers and the public to make mistaken assumptions about the breadth and depth of the powers and capacity of self-regulation. It is damning of the PCC that it was only when the system of regulation was under unprecedented scrutiny and extreme threat, that a programme of reform was announced that asked questions of import directed squarely at the system’s failings.

Restrictions on the PCC’s ability to reform itself
4.36 Linked to the apparent unwillingness of the PCC to implement meaningful reform were real restrictions on the ability to undertake reform. The PCC was not permitted by the industry to examine, reflect and then act on its own performance. The evidence of Baroness Buscombe in this respect is instructive. At the beginning of her tenure as Chair of the PCC, Baroness Buscombe was convinced that the PCC was sufficiently independent from the press and that the system did not require substantial reform.101 In a speech delivered on 15 November 2009, she expressed strong support in principle for the self-regulatory system and in particular sought to rebut criticism that the PCC was not independent from the regulated industry:102 “The press do not regulate themselves. The PCC is funded by the newspaper and magazine industry but operates independently of it. Is independence is guaranteed by a majority of lay members, and staff who have no vested interest in siding with the press. Is that really so difficult to grasp?” 4.37 However, Baroness Buscombe reassessed her view of the independence of the PCC from the industry. Shortly before the instigation of the Independent Governance Review, she felt much more constrained in the PCC’s approach to this task. In evidence, she referred in general terms to the limitations imposed on her by ‘the industry’, making clear that she was required to entertain only those issues covered by the PCC’s terms of reference:103

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p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/SA-B-258.pdf pp51-57, lines 22-24, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ Transcript-of-Morning-Hearing-7-February-2012.pdf 102 p6, PPC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V22.pdf 103 pp39-41, lines 22-22, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ Transcript-of-Morning-Hearing-7-February-2012.pdf

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“My view changed…in that I realised fairly soon after I arrived that of course I was in a very different world in terms of the self-regulatory system as it applies within the press and magazine industry than as it applies within the ASA … In the ASA environment, there was no micro-managing. The role of the equivalent to PresBoF was very much hands off, except for being a funding mechanism and being there to be supportive of the ASA system. … It was terribly important for us to demonstrate … that actually this Commission … [ was] an entirely separate part of the industry. But I also … found in practice it was difficult to be independent when I realised that in order to improve our credibility, to continue what Christopher Meyer I know has called an evolution – I wanted a bit more of a permanent revolution … to really improve the governance and structures of the organisation and to try to put pressure, if I could, with the permission and blessing of the Commission, on the industry to accept that … we needed to up our game in terms of our remit, our sanctions and very much our funding. This is where my view of independence changed. Q. So is the gist of your evidence this, Lady Buscombe: that you were keen for … revolutionary change, but you were facing resistance from the industry against such change? A. Yes, and that was not at the outset … My issue was with the – those who were in charge of giving us permission, as it were, where we sought it, to try and improve our funding, improve our resource overall so we could do a better job”.

Defensive attack and failure to reform
4.38 Representatives of the PCC have tended to reject criticism, and on occasions have made ad hominem attacks on their critics, sometimes in intemperate terms. Over time the PCC has reacted strongly to well-informed criticism or what it perceived to be criticism from, amongst others, Sir Louis Blom-Cooper QC who was the last Chairman of the Press Council; the Media Standards Trust; and the journalists John Simpson and Nick Davies.104 Typically, criticism was repudiated on the basis that the critic had failed to understand the nature of the selfregulatory system and/or had not placed adequate weight on the importance of freedom of expression. I draw attention to only two examples in this regard. First, in February 2009 the Media Standards Trust published its report, A More Accountable Press. Part 1: The Need for Reform.105 In my view, this is a measured and punctilious critique of the PCC, justified on the then available evidence and made more prescient by subsequent events. On 19 February 2009, Sir Christopher Meyer wrote to Mr Salz of the Media Standards Trust making a number of observations, including the following:106 “I am afraid that we also require some reassurance about the credentials of those carrying out the inquiry. In addition to the inaccuracies ... the report does not appear to have been written by anyone with much understanding of self-regulation or the
p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T172.pdf; p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T181.pdf; p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T277.pdf; pp1 – 2, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T2821.pdf 105 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Third-Submission-by-Media-Standards-Trust.pdf 106 pp1-5, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T1125.pdf
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relationship between the PCC and the law. More fundamentally, we have to ask ourselves whether this enterprise is being undertaken in good faith...” 4.40 Further, on 4 March 2009 the Director of the PCC wrote an internal memorandum to all the Commissioners, which included the following statements:107 “As we have maintained throughout, the report is little more than a ‘case for the prosecution’ ... The question is why they are doing this. To answer this, it is important to understand who these people are, and what the genesis of the Media Standards Trust is. For, while it sounds like an impressive official body, the MST is, in reality, no more than a private pressure group of like-minded people who met on a weekend retreat a few years ago – under the aegis of something called ‘Common Purpose’ – and decided that ‘something must be done’ about the popular press. One can therefore surmise that their preferred way of achieving this is to replace the PCC with something that will be more restrictive...” 4.41 Second, in its 2003 report on Privacy and Media Intrusion, the House of Commons Culture, Media and Sport (CMS) Select Committee made a number of recommendations in relation to the PCC. Specifically, it recommended that the PCC Code prohibit payments to the police. It also recommended that there be a ban on newspapers using third parties or intermediaries to access private information about people.108 The PCC did not act on these recommendations. Sir Christopher Meyer gave evidence in relation to the first of these matters. He has said that the making of payments to the police was already a breach of the criminal law.109 However, this rather simplistic explanation overlooks the fact that the codes of other regulators routinely reflect that prohibited conduct may also amount to a violation of the criminal law. Perhaps more tellingly, the Editors’ Code of Practice itself contains provisions (eg clause 13 of the Code, relating to financial journalism) the breach of which might well also constitute a violation of the criminal law. Furthermore, as subsequently addressed in Section 7 below, the Code explicitly covers issues concerning subterfuge and mobile phone voicemail hacking which engage the criminal law. Finally, given the information provided to the CMS Select Committee,110 there was at least some evidence to suggest that newspapers were paying the police. It therefore rather misses the point to say that the existence of a criminal provision obviated the need for the Editors’ Code of Practice to proscribe a particular practice. In relation to the second recommendation, no action was taken. Sir Christopher could not recall whether this second recommendation was discussed with the Commission.111 Certainly, no such ban was implemented. Sir Christopher, spoke to the attitude of the PCC in this respect in evidence:112

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PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-J31.pdf p32, para 63, House of Commons Culture, Media and Sport Select Committee, http://www.publications.parliament. uk/pa/cm200203/cmselect/cmcumeds/458/458.pdf 109 pp75-83, lines 18-5, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/ Transcript-of-Morning-Hearing-31-January-2012.pdf 110 p11, para 32 House of Commons Culture, Media and Sport Select Committee, http://www.publications.parliament. uk/pa/cm200203/cmselect/cmcumeds/458/458.pdf 111 ibid 112 p78, lines 15-19, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/ Transcript-of-Morning-Hearing-31-January-2012.pdf
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“we didn’t feel under an obligation to put into the code everything that the Select Committee recommended. You’ll find other recommendations in other Select Committee reports where we haven’t necessarily adopted what they recommended.” 4.45 Whilst it is clear that the PCC was indeed under no obligation to implement Select Committee recommendations, in the circumstances greater consideration of the merits of the recommendations would have been advisable, as well as being more appropriate to an organisation that took its duties as regulator seriously.

5. The PCC as regulator
5.1 In this section of the Report, I examine the issue of the PCC as regulator and examine by turns the perception and reality of the functions of the PCC in that regard. I look at and comment on the structural issues that prevented the PCC from functioning as a regulator, and left it as little more than a complaints handling body.

A fundamental failing: the PCC was not a regulator
5.2 It is abundantly clear from the evidence before the Inquiry that the PCC was not a regulator as that term is commonly understood. It is though perhaps surprising to many of those who have followed the proceedings of this Inquiry that this perception of the PCC has been shared and articulated by some of the most prominent witnesses speaking on behalf of the selfregulatory system.113 Lord Black, now Chairman of PressBoF and formerly Director of the PCC, gave evidence that “I never believed the PCC to be a regulator”.114 Lord Wakeham, who was Chair of the PCC from 1995 to 2001, told the Inquiry:115 “I was always clear that my task was not to be a ‘regulator’ – the PCC never had formal regulatory powers – but to endeavour to raise standards in the press above the minimum required by law through a process of education, exhortation and adjudication”. 5.4 That said, his position was that the PCC had taken on more features of a regulator:116 “Over the years, [the PCC] has added on functions that are of a more regulatory nature without its structures or remit being amended accordingly. Most of this happened in the last few years, culminating in the disastrous report on phone hacking. I also suspect that the PCC’s Governance Review – with which I was not impressed – tried to remodel it as a regulatory quango, far removed from its original mission, or its powers or expertise, and with little understanding of the nature of the publishing industry.”
pp46-47, lines 18-3, Lord Wakeham, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcriptof-Morning-Hearing-15-May-2012.pdf; p95, lines 9-17, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/01/Transcript-of-Morning-Hearing-30-January-2012.pdf; pp43-45, lines 11-24, Stephen Abell, http:// www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of-Morning-Hearing-30-January-2012.pdf 114 p14, lines 13-14, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-ofMorning-Hearing-1-February-2012.pdf 115 p1, para 2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Witness-Statement-of-Lord-Wakeham. pdf 116 p3, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Witness-Statement-of-Lord-Wakeham. pdf
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5.5

Of the former Chairs of the PCC who have given evidence to the Inquiry, Sir Christopher Meyer is alone in advancing the view that the PCC was a regulator.117 He said that:118 “…the press in the United Kingdom is regulated by a hybrid system, which is partly by law and partly through the implementation of the code of practice of the PCC. So what I understood...and still do, by ‘self-regulation’ was the system which worked through the PCC.”

5.6

In my view, Sir Christopher was utterly mistaken to characterise the PCC as a regulator or the press as a regulated industry. The PCC lacked the structural independence from the press; and the power, the armoury of sanctions or the resources to be a regulator properly so-called. PCC is better characterised as a complaints and mediation service. Nor did it fulfil the function of operating as a standards watchdog within the industry which any regulator properly described would have done. I do not condemn Sir Christopher for labouring under this misapprehension. The PCC deliberately and consistently presented itself as the de facto regulator. This is not a matter of semantics or opinion but rather of fact. The PCC website, the access point to the Commission for the general public, makes clear in plain English that the PCC is the self-regulator for the press. In this context, it is not necessarily surprising that Sir Christopher was, in this respect, in a minority of one. The candid admissions of Lord Black and Lord Wakeham might be thought more surprising given the public presentation of the PCC. Despite the obvious deficiencies in its constitution and make up, the PCC and PressBoF presented the self-regulatory system as a whole as if it were a regulator. This self-presentation took the form both of explicit assertions and the deliberate adoption of the language of regulation in the description of its functions and powers. The effect of this was two-fold. First, it helped to reinforce the perception that the press was subject to an effective system of regulation, as the casual or even the interested observer was capable of being misled, since the distinction between the PCC as it was and as it was claimed to be would tend to be elided in the public mind. Second, the over-statement of its powers weakened the arguments for reform. Examples of this form of self-promotion are legion in the evidence heard by the Inquiry, but I will set out a handful. In 2005, Sir Christopher gave a speech to the Society of Editors in which he said that the PCC was, by that stage, so independent that it was questionable whether self-regulation was any longer the correct way of describing it. He said that the PCC was “the creature that broke free from its creators”.119 The clear implication of this speech was that the PCC had reached a level of effectiveness and independence which meant that it was better than its original conception. This misleading self-presentation continued even after the failings and powerlessness of the PCC had been laid bare. As recently as August 2011, Professor Julian Petley, Professor of Screen Media and Journalism at Brunel University, wrote an article on the New Left Project website, the substance of which was to argue that the PCC was not and never had been a regulator, and would better be described as a mediator.120 The PCC posted a rebuttal to this

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p2, lines 18-25, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Afternoon-Hearing-31-January-2012.pdf 118 p4, lines 17-25, ibid 119 p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/SA-B58.pdf 120 Julian Petley, New Left Project, Press Regulation? – Now There’s an Idea, 24 August 2011, http://www. newleftproject.org/index.php/site/article_comments/press_regulation_now_theres_an_idea

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article on its website, which included the following passage in which little room was left for misinterpretation:121 “Julian Petley is obviously wrong to try to characterise the PCC as merely a mediator and not a regulator. He is wrong to suggest there is nothing in the PCC’s Articles of Association to suggest it performs a regulatory function when those articles actually specifically state that the PCC has responsibility to: ‘consider and pronounce on issues relating to the Code of Practice which the Commission, in its absolute discretion considers to be in the public interest’.” 5.11 Similarly, the press release announcing the appointment of Lord Hunt of Wirral as the new Chairman of the PCC declared that he was to oversee the regeneration and renewal of the system of non-statutory regulation of the press.122 In addition to this explicit self-description as a regulator, the PCC also used language to describe its powers and functions that gave the impression that it was more potent than it really was. The PCC routinely talked about its ‘powers,’ for example in relation to its investigations or sanctions. The PCC said that it carried out ‘investigations’ into complaints, as if it had specific investigatory powers or the capacity to do more than correspond with contacts inside the newspaper. In this respect the PCC projected the impression that it possessed powers, competence, status and capacity which it did not. There was also an implicit representation that the PCC was exercising regulatory functions when it accepted responsibility for investigating high-profile scandals involving the printed media, most notably phone hacking. In announcing its investigation into the allegations on 1 February 2007, the PCC committed itself not only to asking questions of the NoTW editor Colin Myler, but also to ascertaining what steps other newspapers had taken to prevent similar activities from taking place elsewhere. The PCC also committed itself to publishing a “review of the current situation, with recommendations for best practice if necessary, in order to prevent a similar situation arising in the future. This is in line with [the PCC’s] duty to promote high professional standards of journalism”.123 The press release set out steps which might be expected of a typical regulator; in particular the initiation of an investigation, taking steps to discover what prophylactic measures were being taken by particular media groups, and the promotion of standards of conduct within the industry. The press release of 1 February 2007 did not admit to any limitations in the capacity of the PCC to investigate, and was therefore apt to raise expectations unnecessarily. As I make clear in Section 7 below, the PCC’s deficient powers impacted directly on the validity and credibility of that report. The lack of regulatory authority also severely constrained what the PCC could do in relation to concerns around data protection breaches, as I examine in more detail below. At this juncture it is pertinent to note the evidence I have heard that has directly linked the credibility and efficacy of the PCC to the person and authority of the Chair. David Yelland, the former editor of The Sun, said that he took the provisions of the Editors’ Code of Practice seriously “partly because of the respect I had for Lord Wakeham, the then PCC Chair”.124 The personal authority and diplomatic skills of Lord Wakeham, in particular, served to camouflage a number of structural weaknesses which prevented the PCC from operating as a robust and independent regulator.

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p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/SA-B-270.pdf Lord Hunt appointed as new Chair of the PCC, http://pcc.org.uk/news/index.html?article=NzQwMA 123 p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/SA-B88.pdf 124 p2, para 2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-David-Yelland. pdf
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6. Structural problems with the PCC
Non-universal membership
6.1 Membership of the PCC has never been compulsory for publications. Some publications and media groups, for example, the Northern & Shell Group and the satirical magazine Private Eye, have concluded that it is not in their interests to participate in the system of self-regulation. Northern & Shell left the self-regulatory structure for a second time in January 2011, although its titles still abide by the terms of the Editors’ Code of Practice. Private Eye has never joined the self-regulatory structure. Baroness Buscombe recognised the lack of compulsory membership as a weakness in the PCC system,125 as also did the former Director Stephen Abell.126 Lord Black said that:127 “PressBoF recognises that this is a weakness in the system, and part of the price we pay for maintaining voluntary membership. We have done everything we can to bring Northern and Shell back into the system, and continue to do so”. 6.3 Lord Black’s answer raises a number of issues. First, insofar as Lord Black may be suggesting that the price ‘we pay’ is an acceptable one, I entirely disagree. This is a fundamental weakness in the system and must be acknowledged as such, as indeed should the ineffective nature of PressBoF’s efforts to persuade Northern and Shell to re-join, recognising as I do that Lord Black and his co-Directors made considerable efforts in this regard. Further, it should be recorded that having accepting Lord Black’s assurances that every effort was being made to resolve the issue, Baroness Buscombe did not seek to persuade the Northern & Shell Group back into the self-regulatory fold after the departure of the group for a second time in January 2011.128 Whilst the PCC has never been able to offer redress to complainants across the whole range of publications, this situation has been significantly exacerbated by the position in relation to Northern and Shell. Although the PCC may still technically have at least 90% coverage, this state of affairs is manifestly unsatisfactory. There are a number of further issues that link to the voluntary nature of membership and the lack of appropriate incentives to maintain membership. Perhaps most significantly, if an editor disliked a particular decision by or approach of the PCC, newspapers could make credible threats to leave the self-regulatory system. Although there were a number of factors behind the decision of Northern & Shell to leave the PCC, one particular factor identified by witnesses for Northern & Shell was the public criticism by Sir Christopher Meyer of Peter Hill , the editor of the Daily Express, in light of the coverage by the newspaper of the disappearance of Madeleine McCann.129 Whether that criticism should have been couched differently is not the point: rather the implications of the ability of editors to react to criticism from the PCC in this way are real.

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p6, para 35, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-BaronessBuscombe1.pdf 126 p405, para 725.7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 127 p7, para 23, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-Lord-Black1. pdf 128 pp82-83, lines 17-19, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ Transcript-of-Morning-Hearing-7-February-2012.pdf 129 p76, lines 4-25, Richard Desmond, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Afternoon-Hearing-12-January-2012.pdf; pp39-40, lines 9-5, Paul Ashford, http://www.levesoninquiry.org.uk/ wp-content/uploads/2012/01/Transcript-of-Afternoon-Hearing-12-January-2012.pdf; pp3-4, paras 6-8, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-Paul-Ashford1.pdf

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6.5

It cannot but have shaped the relationship between the PCC and the industry that both sides knew that newspapers could opt out of the system if they chose. Baroness Buscombe gave evidence that during her tenure as Chair, three editors threatened to leave the PCC as a consequence of adverse adjudications.130 I acknowledge that her version of events has been questioned by the editors concerned, but the point of principle remains: the loss of any editor would naturally be seriously damaging to the effectiveness and reputation of the PCC. Baroness Buscombe acknowledged that it was a weakness of the system:131 “It is possible for news organisations to register the threat of withdrawing from the system following the issuing of decisions against them. I have been made aware of this in my time as Chairman, although it has never been acted upon. However, it does reveal a potential fragility in the system”.

6.6

The Chair of the PCC, the Director and Commissioners were well aware of the substantial negative impact which the departure of a major newspaper group could have on the credibility of the system of self-regulation. It is hard to think that the need to avoid such a catastrophe did not influence the thinking of these people, committed as they were to the preservation of self-regulation. At the very least, the fact that an editor could make a credible threat to leave on behalf of his or her title would give a reasonable and well-informed observer cause to believe that the PCC might seek to avoid criticising newspapers too often or too heavily, for fear of the consequences to the system of self-regulation.

Investigating complaints
6.7 The PCC has very limited power to investigate complaints. In particular, it does not have the power to compel parties to produce documents or any other evidence in support of, or capable of contradicting, their account of events. The PCC does not have the power to ask for sworn evidence. There is no sanction for an individual who misleads the PCC, tells half-truths or fails to answer the PCC’s questions. A PCC investigation into a complaint typically involves the complaints officer contacting a newspaper to ask for its version of the events or justification for the content at the heart of the complaint. There then follows correspondence between the PCC complaints officer and a contact at the newspaper, typically the newspaper’s legal department or managing editor’s office.132 The PCC does not demand documents or other evidence in support of the positions adopted by the parties, although parties might voluntarily supply these. Complainants have access to all material submitted by newspapers in support of their accounts, but do not necessarily have access to the correspondence between a complaints officer and the newspaper.133 The PCC does not request statements from the journalists who researched and wrote stories.

6.8

p63, lines 5-10, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcriptof-Morning-Hearing-7-February-2012.pdf 131 p7, para 43, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-BaronessBuscombe1.pdf 132 pp86-88, paras 194-198, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf; pp1-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofLouise-Hayman.pdf; p4, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Witness-Statementof-Tom-Crone.pdf; p5, para 14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statementof-Tony-Gallagher.pdf; pp1-2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofJames-Harding.pdf; p2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statementof-Liz-Hartley.pdf 133 pp86-87, para 194, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf

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6.9

If the PCC is to reach fair decisions, it is reliant on editors and complainants not only telling the truth but providing a full, fair and balanced account. It has been made clear during the course of this Inquiry that when the PCC twice investigated phone hacking this was not the case, as more fully addressed below. It is impossible to say for certain that they were misled on other occasions, but given how many cases the PCC dealt with every year it would be surprising if they were always given the entire picture or told the whole truth. It cannot be the case that entering into correspondence with an editor, or with a legal department or managing editor’s office in this way, is tantamount to an investigation in any meaningful sense. Similarly, anyone aware these of the limitations would question whether the PCC was really capable of obtaining facts and coming to safe conclusions about the merits of a complaint.134 On occasion, the lack of investigatory powers meant that the PCC could not resolve a dispute between parties. This happens when the accounts provided by the two sides cannot be reconciled; thus, no negotiated settlement can be reached. The former Director of the PCC Tim Toulmin gave the following account of this type of finding:135 “There’s a rare category of ruling called ‘no finding’ which occasionally the PCC would deploy … but almost always it was possible to reach an outcome whereby, if there was something wrong, it would be put right.”

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6.11

Even if a ‘no finding’ ruling was rare, it is highly unsatisfactory that such a result should ever come about; a dispute about the facts leaves a title effectively exonerated (there being no adverse finding) and no mechanism for a complainant to obtain redress. It is also illustrative of the weakness of the system. Some newspaper figures have recognised that the lack of any real investigatory powers was a failing. The editor of the Financial Times, Lionel Barber, said that in his view a replacement body for the PCC needed to have the power to investigate and with this I wholeheartedly concur.136

Powers the PCC did not exercise – investigations without a complaint and third party complaints
6.12 Subject to a small number of refinements set out in evidence by Lord Hunt during the course of Module Four, which I address further below, the PCC has only investigated complaints which come from the person affected by an article or investigation. Baroness Buscombe said that, in some cases, third party complaints may receive a response as the PCC does on occasion seek to contact a directly affected party and progress the complaint.137 The source of the general practice of the PCC in this respect is Article 53.3(a) of the Articles of Association which govern it:138 “53.3 A complaint may be made by an individual or by a body of persons (whether incorporated or not) but, in addition to the requirements of Article 53.1, shall only be entertained or its consideration proceeded with if it appears to the Commission that:

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p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-Michelle-Stanistreet. pdf; pp2, 5-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/First-Submission-by-Media-StandardsTrust.pdf 135 p66, lines 6-10, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-30-January-2012.pdf 136 pp47-48, lines 23-7, Lionel Barber, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-10-January-2012.pdf 137 p5, para 26, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-BaronessBuscombe1.pdf 138 p13, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-A2641.pdf

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the complaint is made by the person affected or by a person authorised by him to make the complaint”. 6.14 However, the PCC does have a discretion to investigate where there is no complaint from the directly affected party:139 “53.4 Notwithstanding the provisions of Article 53.3, the Commission shall have discretion to consider any complaint from whatever source that it considers appropriate to the effective discharge of its function.” 6.15 As a linked issue, Article 53.1A provides:140 “It shall also be the function of Commission to consider and pronounce on issues relating to the Code of Practice which the Commission in its absolute discretion considers to be in the public interests [sic]”. 6.16 The difference between these sub-Articles is probably one of degree. On my interpretation of these provisions (which certainly could be clearer), the PCC has a broad residual power to entertain third-party complaints as it sees fit, although no guidance is supplied as to the type of circumstance which might trigger the discretion. Further, Article 53.4 has to be read in conjunction with Article 53.7,141 which is heavily weighted in favour of what might be described as Article 10 (as opposed to Article 8) rights as set out in the EHCR.142 As for Article 53.1A, the Commission’s discretion under this provision does not presuppose the making of any complaint, third party or otherwise. It is a potentially wide-ranging, roving power, which enables the PCC to issue guidance and carry out investigations to the extent that issues relate to the Editors’ Code of Practice. The scope of this latter investigatory power is uncertain: the reference to the Editors’ Code of Practice clearly requires the identification of some sort of issue as regards either the interpretation or application of the Code. Whilst these are fluid matters, the discretion of the PCC is, in any event, ‘absolute’. I have seen evidence that suggests that this Article appears to have been used a number of times by the PCC, most notably in the two investigations into phone hacking in 2007 and 2009. I use the verb ‘appears’ because Article 53.1A has not been specifically invoked by the PCC in this context. There does not appear to have been a clear or consistent policy applied to the exercise of this discretion. In this regard the evidence of Lord Wakeham and of Tim Toulmin about the investigation of third party complaints illustrates the attitude of both the PCC and the industry to such complaints. Lord Wakeham suggested that following his appointment as Chair, there was pressure from the industry to prevent third parties from complaining about stories which did not directly affect them:143 “…when I got there, the Press Council [sic] had fallen into considerable disrepute with the press for one reason – one of the reasons was that a whole lot of people were
ibid ibid 141 ‘In carrying out its functions in relation to complaints the Commission shall have regard to generally established freedoms including freedom of expression and the public’s right to know, and defence of the press from improper pressure’ 142 See Tim Toulmin’s discussion of this provision: pp22-24, Tim Toulmin, http://www.levesoninquiry.org.uk/wpcontent/uploads/2012/01/Transcript-of-Morning-Hearing-30-January-2012.pdf 143 p24, lines 1-12, Lord Wakeham, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-ofMorning-Hearing-15-May-2012.pdf
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making a lot of complaints and many of them are pretty frivolous …. and they did say the Press Complaints Commission is there to deal with people’s complaints who have an interest in the complaint, a proper interest. In other words, if they [say] something about me, Joe Bloggs can’t complain. I can complain. It has to be relative to me. That’s what they wanted to do and I was trying to get that system worked.” 6.19 Mr Toulmin gave the following reasons for the failure to exercise the discretion to investigate third-party complaints more regularly:144 “The position…is that the PCC pretty much takes all complaints but where there is a first party, their engagement is required. The saga of – very much in the early days of the PCC, where Lord McGregor made statements about Princess Diana and so on based on an understanding – a sort of outrage about how she was being treated, was very much seared on the consciousness of the Commission for years to come, which is that it is impossible to really take a view about the merits under the code of particular articles unless you have the involvement of the person concerned.” 6.20 The Inquiry received evidence from a number of witnesses about the impact of this policy; it renders it impossible for individuals or representative groups to bring complaints on behalf of sections of the community who were the subject of misleading or discriminatory articles. Representatives of the Irish Traveller Movement in Britain made the point in the following way:145 “The result [of the PCC’s refusal to accept third party complaints] is that as long as they are carefully worded, derogatory references to Travellers can be published repeatedly, as they were in the Sun’s ‘Stamp on the camps’ campaign, without committing any offence. Yet it is clear that articles of that sort do cause substantial damage to the rights and reputations of Travellers, fanning hostility against them in settled communities.” 6.21 I now turn briefly to the refinement raised in evidence by Lord Hunt to which I referred at paragraph 6.12 above. Lord Hunt said that the practice of the PCC has been to entertain third party complaints “on accuracy on a point of fact”.146 However, exactly how this practice has been conducted remains unclear. Many issues of ‘fact’ may, on analysis, be issues of opinion.

Monitoring and investigations
6.22 The PCC did not monitor for breaches of the Editors’ Code of Practice, nor did it launch investigations into potential breaches of the Code of its own volition. In response to comments made in the Report in 2010 by the CMS Select Committee into Press Standards, Privacy and Libel, Stephen Abell wrote that:147 “The Commission does not accept that it is possible – or appropriate – to monitor widely for compliance with the Code, especially given the vast amount of information that is now being published on and offline across the newspaper and magazine industry. At the heart of the Code is the protection of the individual and the Commission believes
p75, lines 3-14, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-30-January-2012.pdf 145 p2, Irish Traveller Movement in Britain, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Submission-from-The-Irish-Traveller-Movement-April-20121.pdf 146 p13, lines 4-23, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 147 p4, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-R27.pdf
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a model of efficient and transparent complaints handling to be more appropriate to a digital age.” 6.23 In a speech made in May 2003, Sir Christopher Meyer, expressed the view that:148 “any measure that would turn the PCC into a directive body – initiating complaints at random, intervening in issues which are nothing to do with the Code, or establishing any superior service for the rich and famous. We have a set of rules that work well for everyone – regardless of status – and we move away from them at our peril”. 6.24 It is not clear what link is supposed to exist between the initiation of complaints and a differential service being offered to different categories of complainant. It is true that an issue under the Code would always have to arise, but that is so obvious that it goes without saying; the PCC could not act if no question of breach of the Editors’ Code of Practice had arisen. The reference to moving away from rules ‘at our peril’ serves to elide two different concerns: the first, that the PCC might apply rules which were not rooted in the Code (a justifiable concern); the second that the PCC might take upon itself the function of investigating clear breaches of the Code in the absence of a direct complaint (an unjustifiable one). Neither do I understand the reference to the rich and famous. They are, presumably, more likely to be aware of the existence of the PCC, their rights and the ability to complain: the willingness to look at a wider picture is more likely to help those who are not in that position. There are clearly circumstances when it would have been appropriate for the PCC to launch an investigation of its own motion, deploying the powers at its disposal under Article 53.1A. One clear case is in relation to newspaper coverage following the disappearance of Madeleine McCann. A fuller exploration of the conduct of the press in that case appears in Part F Chapter 5 above, but for present purposes the focus is on the PCC alone. It is easy to see why the McCanns might not have wished to launch complaints on their own account, given the scale and tone of media interest in them, and the nature of Sir Christopher Meyer’s advice to Dr Gerry McCann. It is, in my judgment, inexplicable that the PCC chose not to exercise its discretion to investigate in such a case. I note in this regard that a number of individuals gave evidence that they did not complain to the PCC because they were concerned that doing so would lead to retaliation from the newspaper industry in the shape of negative coverage or future invasions of privacy. Had the PCC initiated investigations of its own motion, or accepted third party complaints, the issue of retaliation would have been deadened. The PCC’s policy served to perpetuate a wholly unsatisfactory state of affairs whereby complaints were (and remain) dis-incentivised and the PCC’s own contribution to the evolving principles surrounding the issue of privacy in particular is limited. Lord Wakeham’s view was that “The PCC’s absence from the debate about privacy – including high profile adjudications – has … eroded its authority”.149 This view was valid in the late 1990s and remains so now.

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p6, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-–-D8.pdf p3, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Witness-Statement-of-Lord-Wakeham. pdf

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“A complaint may be made by an individual or a body of persons ... but, in addition to the requirements of Article 53.1, shall only be entertained or its consideration proceeded with if it appears to the Commission that: ... the matter complained of is not the subject of proceedings in a court of law or tribunal in the United Kingdom; and where the matter complained of is a matter in respect of which the person affected has a remedy by way of proceedings in a court of law in the United Kingdom, in the particular circumstances it is appropriate for the Commission to consider a complaint about it.” 6.29 There are a number of issues with these provisions which need to be explored. First, they incorrectly draw no distinction between criminal and civil proceedings. In the event that the PCC might become aware that a criminal investigation or proceeding has commenced, it is obviously right that the PCC should defer any investigation it might undertake of its own motion until such proceedings have been concluded. This is the practice of comparable bodies responsible for the regulation of a profession, such as the General Medical Council. Although in cases involving professionals it is standard practice to suspend individuals from practice pending the outcome of the criminal process, I fully recognise that different considerations rightly apply in relation to the press. The deferral of regulatory investigation may be regarded as a self-denying ordinance designed to meet the wider interests of justice and the possibility of creating prejudice. The position is different in relation to civil proceedings. There may be reasons, depending on the facts of the particular case, for awaiting the outcome of such proceedings before commencing any regulatory process, but there is no requirement to elevate this into an absolute prohibition; Article 53.3(b) is currently framed in those terms. Second, and regardless of whether the proceedings in issue are criminal or civil, the provision has been interpreted by the PCC in such a way that as soon as any proceedings begin the ability of the PCC to entertain a complaint is precluded.150 But this is not how the provision is framed, as is apparent from the use of the present tense in Article 53.3(b). Neither is it the manner in which most regulators operate: extant proceedings may be a current bar to regulatory action (ie, for so long as the proceedings may continue), but not an indefinite prohibition. Third, Article 53.3(c) is potentially of extremely wide application since most breaches of the Code could also give rise to civil action; this provision as drafted therefore suggests that in these circumstances (ie, the paradigm case of Code breach) the entertaining of a complaint by the PCC requires particular justification. Since there is no policy setting out how the PCC will exercise the discretion established by this Article, it is not clear whether the PCC interpreted this provision in so restrictive a manner. What is clear is that these Articles taken together were the purported basis for Sir Christopher Meyer’s advice to Dr McCann that the latter should take legal action in relation to highly defamatory and offensive articles above the

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p22, lines 3-11, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-30-January-2012.pdf; pp38-41, lines 16-5, Sir Christopher Meyer, http://www.levesoninquiry.org. uk/wp-content/uploads/2012/01/Transcript-of-Morning-Hearing-31-January-2012.pdf; Ofcom is precluded from investigating complaints whilst civil proceedings are ongoing: see section 114 of the Broadcasting Act 1999, as amended by section 132(2) of the Communications Act 2003. The position is the same as regards the FSA

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disappearance of his daughter Madeleine, but that such a course of action would prohibit Dr McCann from seeking redress through the PCC.151 6.33 In one area at least, the PCC appears to have been eager to take on cases which might otherwise have resulted in civil actions. Exercising this discretion, the PCC sought to gather in as many cases relating to privacy as possible, thereby restricting the number of privacy actions which went before the courts, despite (or perhaps because of) the option for complainants to bring a civil action for breach of privacy at least since the passage of the Human Rights Act.152 In my view these provisions have a stifling effect on the operation of the PCC, and are exceptionable. There was a lack of consistency and transparency in the exercise of the PCC’s discretion under Article 53.3(c) that militated against the proper function of the organisation as a proper regulator. More so the use of this discretion, particularly with regard to privacy, helped facilitate the PCC’s function as a shield for newspapers against litigation.153

Powers the PCC did not exercise – failure to hold oral hearings
6.34 The PCC has not held oral hearings in any cases. This means that it has not had the opportunity to ask questions or assess the credibility of parties where facts were contested. This was a deliberate practice and not the consequence of the lack of any relevant powers. The PCC had power to hold oral hearings under the existing Articles of Association, and PressBoF had argued this point in response to recommendations made by the CMS Select Committee.154 The 2010 Independent Governance Review had also recommended that the PCC move to a policy of holding such hearings.155 The PCC has justified this reluctance to use these powers on the basis that that it might compromise its commitment to being free and fair. It has argued that oral hearings would lead to the involvement of lawyers, and that that would introduce a layer of expense and delay.156 But this is to overstate the position. First, this line of argument rather conveniently ignores the fact that the industry often engaged lawyers when responding to complaints made through the PCC; this is a feature that I explore in more detail below. Second, oral hearings would not be regarded as the general rule, but would only meet the end of justice in a case of particular complexity or where a dispute of fact arises on the material placed before the PCC. In any event, the PCC would not be looking at a system which encouraged mini-trials and concomitant expense and delay, but something far more streamlined and practical. The holding of hearings where appropriate might have allowed the PCC better to demonstrate publicly that it had the capacity to find facts and to question any inconsistencies which emerged from the parties’ accounts of events. It may also have helped mitigate the small but unfortunate and, in my view, unnecessary number of cases in which no resolution or finding of fact could be made.

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pp84-88, lines 7-25, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/ Transcript-of-Morning-Hearing-31-January-2012.pdf 152 pp1-4, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T2100.pdf ; pp1-6, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-X26.pdf ; pp1 – 5, Stephen Abell , http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-T1151.pdf ; pp1-2, http:// www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-S41.pdf 153 See for example PCC, pp1 – 2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U12. pdf; pp9-13, lines 13-6, Peter Hill, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofAfternoon-Hearing-12-January-2012.pdf 154 Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-–-D4.pdf 155 Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-F1.pdf 156 Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-F2.pdf

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Inequality of arms
6.37 The PCC has argued that one of the fundamental advantages of the existing system of self-regulation is that there is no need for complainants to go to the expense of engaging solicitors, as complaints officers employed by the PCC will oversee the process on behalf of the complainant. I note that in some cases complainants have chosen to do so irrespective of the cost. However, this line of argument serves to disguise a fundamental mismatch in terms of both resource and expertise, as the response of individual newspapers to complainants is mostly undertaken by the legal department or managing editors of the newspaper in question.157 Thus, while respondent publications have the benefit of legal assistance, complainants rely in the main on the PCC complaints officers to act as their advocate in the process. There are two fundamental issues at play in this regard. The first relates to the training and experience of complaints officers at the PCC. The second relates to their role in the complaints process. Whilst I am satisfied that the complaint officers at the PCC were highly professional group of people who were skilled at what they did and did their best in trying circumstances, I do not accept that there existed in any way parity of arms between them and the lawyers and managing editors who responded on behalf of the industry. Complaints officers at the PCC are typically recruited straight from university or soon after graduating. There is no requirement that they have any particular experience.158 As at September 2011, only two of the complaints officers had legal training; the others joined from other industries.159 The past two Directors of the PCC (excluding the present transitional director, from whom the Inquiry has not heard) were also recruited from within the ranks of complaints officers. Neither of them had had any substantial experience outside the PCC secretariat, and both were elevated to the position of Director at a relatively young age.160 I have already expressed my positive view of the abilities and qualities of Mr Toulmin and Mr Abell. However, the role of Director (effectively Chief Executive) of the PCC necessarily involved dealing with highly experienced figures within the newspaper industry, politics and other areas. There is at least a question mark over whether they had the overall fire-power to handle the leaders of the industry within the PCC’s purview. I doubt that the relationship was seen as being equal. My second point relates to the function of the PCC complaints officers in this context. As set out above, users of the services of the PCC often spoke of the politeness and helpfulness of these complaints officers, as well as their ability to conjure up imaginative solutions. However, it would be fundamentally incorrect to suggest that the PCC represented the complainant in the process, and in so doing helped to bridge the even greater chasm in expertise and experience that existed between the vast majority of those who made complaints and the

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pp86-88, paras 194-198, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf; pp1-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofLouise-Hayman.pdf; p4, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Witness-Statementof-Tom-Crone.pdf; p5, para 14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statementof-Tony-Gallagher.pdf ; pp1-2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofJames-Harding.pdf ; p2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statementof-Liz-Hartley.pdf 158 p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/SA-B183.pdf; p10, para 12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-Stephen-Abell.pdf 159 p56, para 129, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 160 p10, paras 12-16, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf; p1, para 1.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-TimToulmin.pdf

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representatives of industry. In most cases, the PCC functioned as a letterbox both for the complainant and the industry, passing on the accounts of events but more damagingly, particularly for the victims of press mistreatment, being unable to challenge in any way the version of events advanced by the industry even in those cases when these were clearly open to question.

Lack of powers – sanctions
6.41 The PCC does not have sufficient sanctions to act as a deterrent against breaches of the Code. PCC sanctions are limited to admonishment161 and the publication of adjudications. While it may be embarrassing for editors to publish adjudications, this sanction is not enough to deter repeat offending. Further, I have seen no evidence that the sanctions regime overall has had a long-term impact on the behaviour and actions of publications or journalists who were found to have transgressed. I am gratified that there is some support even among press figures for the conclusion that the sanctions available to the PCC’s battery are insufficient. For example, the Editor-in-Chief of Associated Newspapers, Paul Dacre, said at one of the Inquiry’s seminars in October 2011 that, in his view, fines should be available in cases of the “most extreme malfeasance”.162 The editor of the Financial Times, Lionel Barber, gave evidence that an ability to impose fines is essential for any replacement for the PCC. However, Mr Barber also emphasised that the printing of prominent apologies or corrections were a real deterrent for editors.163 However, PCC witnesses have defended the current range of sanctions as adequate. Sir Christopher Meyer, for example, gave evidence that:164 “I had spent some time studying the PCC before taking this job….and what had become clear to me was that editors just did not like having to admit in their own newspapers that they had screwed up, in terms over which they had no control. That is to say the text of the adjudication, as agreed by the Commission, had to be reproduced verbatim, under a PCC rubric in the newspaper… So it wasn’t as if the statement ‘no editor wants the blemish of a negative adjudication on his or her record’ was some rash thing that I pulled from the sky. It was based on my experience, from what I’d read, from the experience of others in the PCC, Lord Black, who had been director for some time, and I have to say to you…after six years, it was an impression, again, that was strongly reinforced from my own experience”. 6.44 The PCC has argued that that fines are unnecessary, disproportionate and liable to create an overly legalistic disciplinary process. This line of argument has been advanced by a number of witnesses from the PCC. Sir Christopher set out the fundamentals of this argument in a speech in 2003:165

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6.43

Of which there were approximately six a year, usually reserved for cases of undue delay and failing to publish adjudications with due prominence: see the evidence of Tim Toulmin; p27, lines 11-18, Tim Toulmin, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of-Morning-Hearing-30-January-2012.pdf 162 p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/RPC_DOCS1-12374597-v1-PAUL_DACRE_S_ SEMINAR_SPEECH.pdf 163 p47, lines 9-22, Lionel Barber, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-10-January-2012.pdf 164 p23, lines 2-20, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Morning-Hearing-31-January-2012.pdf 165 p5, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-–-D8.pdf

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“... would invite the colonisation of the system by lawyers, with all the costs and delay that this would entail. You could throw ‘free’ and ‘fast’ out of the window. Those who believe that fines mean sharper teeth fail to understand that no editor wants the blemish of a negative adjudication on his or her record.” 6.45 However, the points raised by Sir Christopher misunderstand the difference between providing redress (which must be free and fast) and the maintenance of standards which can be entirely free standing of the mechanism for complaints. Neither do I accept that it would necessarily lead to “the colonisation of the system by lawyers”: it would depend on the way in which the ‘system’ was set up and operated. Lord Wakeham also gave evidence that explains the thinking underpinning the PCC’s historical opposition to fines. First, it would have been inappropriate for editors to be involved in the fining of other editors. Second, fines would have affected publications differentially. Third, in extreme cases newspapers might be put out of business by fines.166 In my view none of these arguments has any foundation. Clearly, editors should not be involved in decisions leading to the fining of other editors, but this is an argument for removing editors from the decisionmaking process rather than for failing to empower the Commission where necessary. The economic arguments against fines clearly could be met by requiring the regulator to take ability to pay into account (as is standard in any regime which supports the imposition of financial penalties). In any event, fines would be reserved for only the most serious or systemic breaches of the Code. The PCC’s opposition to a system of fines is longstanding. Writing in Risk and Regulation magazine in Autumn 2008, Tim Toulmin suggested that fines were unlikely to be effective, suggesting that they were a weaker sanction that an adverse adjudication:167 ”[A] common misunderstanding is about the power of peer pressure: some people don’t rate it and think that only a system of fines would be an adequate deterrent or punishment. They couldn’t be more wrong. When the PCC sharpens its claws for a public criticism of an editor the howls of pain are loud and clear. No editor wants their decisions held up in public by their professional standards body as an example of bad practice. On the other hand, fines are a corporate rather than a personal punishment, and therefore not as keenly felt.” 6.48 I am not impressed by this argument at all. Fines would be in addition to the publication of the companion adjudication. In the appropriate case, the editor could be required to pay an individual fine (whether or not his paper would defray the cost on his behalf would be another matter); and, in any event, a substantial fine imposed on a company would mark the seriousness of the breach and impact on the reputation of the editor. Baroness Buscombe raised a different issue; she suggested that the introduction of fines might ruin the collaborative relationship between the self-regulatory structure and the industry and that this would have threatened the PCC’s ability to do its work:168 “…the whole issue of fines is quite fraught, one of the reasons being it has the risk of turning the system from one that is collaborative – which is really important on a Saturday night at 1 in the morning when you have the managing editor of the Sun or
pp39-40, lines 13-22, Lord Wakeham, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcriptof-Morning-Hearing-15-May-2012.pdf 167 p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-I26.pdf 168 p58, lines 4-19, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcriptof-Morning-Hearing-7-February-2012.pdf
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the Mail … discussing with the director whether or not something should be run … I have a hard time with lawyers I know understanding that actually a system where the collaborative can actually produce very good results as opposed to adversarial, and when you introduce a system of fines, there is a concern that that might break down the collaborative relationship.” 6.50 This evidence, however, betrays the fundamental flaw at the heart of the relationship between the PCC and the entities that it was supposed to be regulating, that uniquely it depends on an element of consent and collaboration between these parties. Although collusion would be too strong a term, the terms of engagement lack an appropriate deference; the concern to achieve collaboration should not be the order of the day, but rather the press should respect those who are regulating it. One only needs to compare the position of the Bar Standards Board, the Solicitors’ Regulation Authority and the General Medical Council to begin to understand the fundamental difference between the colour and dynamics of a relationship between a regulator properly so called and the entities or parties being regulated. The point I make here is a cultural one, and does not ignore the fact that the bodies I have identified are regulators of professional people rather than of an industry like the press: I am doing no more than pointing out the nature of the relationship between regulator and regulated. Furthermore, none of what I am saying in this context is intended to suggest that a regulated entity should not be assisting the regulator – in that specific sense, collaborating with it – if and when a complaint is made or the need for an investigation arises. There is one further piece of evidence which lays bare the nature of the relationship between the PCC on the one hand and editors in particular in this regard. Until the amendment of the Editors’ Code of Practice in January 2011, the only obligation on editors in relation to the publication of adverse adjudications was that they should be given ‘due prominence’. Ultimately, this was a matter of judgment for the editor in question, rather than a matter for the PCC to impose. Sir Christopher Meyer was asked why he did not advocate amendments to the Code which would have enabled the PCC to insist on the placement of any adjudication in the newspaper, as it were whether the editor liked it or not. It was put to him that any regulator worthy of the name would have armed itself with such a power; Sir Christopher’s answer was that he had other more pressing priorities.169 Even now, the Code states that “prominence should be agreed with the PCC in advance”,170 a provision which sets out the expectation of a negotiation rather than any imposed outcome. Overall, it is clear that the armoury of the PCC is limited and needs enhancement. I recognise that the industry has recently come to accept the force of this: the proposal put forward on behalf of the industry by Lord Black confers the power on the new body to levy fines in cases of serious or systemic breaches. Further, I should not be interpreted as suggesting that fines are appropriate in every case. In Part K Chapter 7 below I identify the circumstances in which the ability to impose a fine should exist. I should also make clear that my concern is not with the notion of an adverse adjudication; the Inquiry has heard examples of other regulatory systems in which the publication of an adverse adjudication is a real and effective sanction, but with the particular operation of this system through the PCC.

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pp57-58, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-31-January-2012.pdf 170 PCC, Editors’ Code of Practice, clause 1(ii), http://www.pcc.org.uk/assets/696/Code_of_Practice_2012_A4.pdf

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The sanctions did not bite
6.54 There is no evidence that even the most severe sanctions available to the PCC had a real impact on those who transgressed. Although much emphasis was placed on the editors’ fear of an adverse adjudication, the impact of such an adjudication did not go beyond this; newspapers did not lose circulation as a consequence of criticism by the PCC nor is there much evidence that editors or journalists were disciplined in any significant manner171 or that their careers were in any way affected by PCC criticism. In his evidence to the Inquiry, Lord Wakeham set out the steps he made to improve public trust in the work of the PCC: including improvements to the sanctions available to the PCC and particularly the inclusion into journalists’ contracts of the Editors’ Code of Practice: “so that in the cases of serious Code breaches, I could refer the matter to the employer”.172 Lord Wakeham also cited the example of the public admonishment of Piers Morgan by Rupert Murdoch in 1995 following a strong PCC adjudication relating to the publication of pictures of Countess Spencer in the grounds of a private clinic as evidence of the effectiveness of the new sanctions.173 This same episode was dealt with in evidence by Piers Morgan himself. However, the gist of his evidence was somewhat different. Mr Morgan recalled a later conversation with Mr Murdoch in which the latter apologised for having publicly rebuked him. In Mr Morgan’s book The Insider, it is recorded that Mr Murdoch said “I’m sorry about all that press complaining thingamajig”.174 Mr Morgan has suggested that the rebuke was intended to mitigate pressure for a privacy law.175 In evidence, Mr Morgan told the Inquiry that it was his impression in light of this conversation that Mr Murdoch “did not give a toss” about the PCC.176 Mr Murdoch, in his evidence, has said that he did not recall speaking in this way, but that he might have said that the matter should be remembered but moved on from.177 A similar pattern of events followed the public criticism of the former editor of the Daily Express, Peter Hill. Sir Christopher Meyer criticised Mr Hill for his newspaper’s coverage of the story of the disappearance of Madeleine McCann, coverage for which the Express eventually apologised publicly and paid substantial damages to the McCann family for defamation. However, when, somewhat late in the day, Sir Christopher excoriated Mr Hill and the Express’s coverage on the Radio 4 Today programme, the response of Northern & Shell’s proprietor Richard Desmond was not to criticise Mr Hill but rather to commiserate with him:178 “I remember that night after he was attacked by the chairman of the PCC, I remember calling him at 11 o’clock at night. I think he was convinced I was going to fire him. But I didn’t fire him, I spoke to him from 11 o’clock for about two hours and my ex-wife

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The available evidence is covered in Part C, Chapter 3 above p10, para 34, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Second-Witness-Statement-of-LordWakeham.pdf 173 ibid 174 Morgan, P, The Insider, p82 175 Morgan, P, The Insider, p82 176 pp97-101, lines 23-2, Piers Morgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Transcript-ofAfternoon-Hearing-20-December-2011.pdf 177 pp60-61, lines 11-14, Rupert Murdoch, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/04/Transcriptof-Morning-Hearing-26-April-2012.pdf 178 p80, lines 1-8, Richard Desmond, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofAfternoon-Hearing-12-January-2012.pdf
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spoke to him for about an hour afterwards, you know, because he’d done to the best ability – report the facts.” 6.58 In these two instances, criticism of an editor by the PCC – whether by formal adjudication or very public criticism by its Chair – does not seem to have had any negative effect on the careers of the editors concerned. Mr Morgan went on to continue a very high-profile career in journalism; Mr Hill is still employed by Northern & Shell as Editor Emeritus, although he did resign from the PCC shortly after the events in question. There is nothing to indicate in either case that the involvement of the PCC had the impact which is claimed for it. The Inquiry has heard similar evidence from other quarters. For example, a former journalist with the People, was recorded by the film maker Chris Atkins discussing the PCC. It is clear from the conversation that the journalist was not overly concerned about the consequences of getting an adverse PCC decision:179 “…getting a PCC isn’t great, but a lot of papers just kind of brush it aside – all it is a little apology, somewhere in the paper – you get a slap on the wrists if you get reported by the PCC, but there’s no money.” 6.60 The Inquiry has heard evidence from a number of editors and representatives of the PCC itself that journalists now routinely have a requirement to comply with the Editors’ Code of Practice as a condition of their contracts. It was suggested that this meant that criticism by the PCC had real weight because it might lead to disciplinary action. However, the Inquiry has heard of only one instance of this ever happening. This evidence was provided by Stephen Abell. He recalled the dismissal of the journalists working on the Daily Mirror’s ‘City Slickers’ column for breach of the Editors’ Code of Practice. Mr Abell gave the following account of events:180 “In an internal inquiry, the company concluded that the journalists involved had breached the Editors’ Code; as their contracts of employment had Code compliance written into them, the journalists were dismissed.” 6.61 Doubtless the ‘City Slickers’ journalists were in serious breach of the Editors’ Code of Practice. However, given that their activities eventually led to their being convicted for criminal offences, it is impossible to believe that they would not have been dismissed in any case. I also record that the dismissal came following an internal investigation rather than a PCC investigation. It is therefore difficult to draw the inference that the inclusion of provisions requiring adherence to the Editors’ Code in journalists’ contracts of employment has in itself resulted in improved behaviour or, as asserted by Lord Wakeham, effectively given the PCC an additional, effective, sanction. The picture that emerges from this evidence is that while editors and others may have been personally embarrassed by criticisms by the PCC, the sting was the result of the personal dislike of being criticised rather than the sanction.181 In this respect I am in agreement with the ethicist, Dr Neil C. Manson of the University of Lancaster. In his written evidence he described

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p11, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Exhibit-Annex-2-to-Chris-Atkins-Supp.pdf p44, para 238, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-of-StephenAbell.pdf 181 pp62-63, lines 18-4, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ Transcript-of-Morning-Hearing-7-February-2012.pdf
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the sanctions for breach of the PCC Code as “woefully inadequate.”182 In my judgment, that is a correct assessment. Whatever their limited merits, they did not provide a sufficiently powerful deterrent to prevent journalists and editors from breaching the Editors’ Code of Conduct.

Too many negotiated settlements
6.63 Many witnesses and commentators have criticised the PCC for mediating too many complaints to a negotiated conclusion rather than giving formal adjudications.183 A number of reasons have been advanced for this: newspapers know how to string out the process, causing “complaint fatigue”; newspapers prefer to come to some sort of private accord with complainants to avoid the likelihood of an adverse adjudication; and the whole system is geared towards PCC complaints officers acting as mediators and conduits to the compromise of disputes. A cursory examination of the statistics shows that few complaints reach the stage of formal adjudication, and that – although the figures vary from year to year – about half of these are resolved in favour of the complainant.184 This very last statistic does not give cause for concern in itself, but given the number of complaints in any one year what is troubling is the paucity of cases which eventually arrive at the adjudication stage. The PCC would claim that this is a mark of the success rather than the weakness of the system. That is because many complainants welcome a relatively speedy resolution, and in a different context it might be remarked that well over 95% of all civil disputes are resolved consensually, although as I note elsewhere,185 resolution through mediation is not always speedy. However, given that a mediated complaint does not feature in any statistics as a breach of the Code, is seems clear that from the point of view of public accountability and compliance there is a misleading picture. Further, this different context does need to be understood. The policy reasons militating in favour of the compromise of private disputes (cost; avoidance of court time; the preference for settlement over a fight to the bitter end) do not apply with anything like the same force in relation to matters which possess, or at least ought to possess, a regulatory or standards dimension. In most regulatory regimes, the complainant and the regulated party are given the opportunity to sort out the dispute between themselves,186 but once that process breaks down the regulator takes over and investigates the matter. There is a balance to be struck between mediation and formal adjudication, but I have little doubt but that under the current system that balance has fallen in the wrong place.

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p18, para 9(e), http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-Statement-of-Dr-NeilManson.pdf 183 For example pp4-5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-ProfessorRoy-Greenslade-of-City-University.pdf; and http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/SixthSubmission-by-Media-Standards-Trust.pdf, passim 184 For example in 2009 there were 18 adverse adjudications by the PCC; p11, Stephen Abell, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E72.pdf 185 Part D, Chapter 2 186 In relation to barristers, sets of Chambers are required to operate complaints’ systems and complainants are also obliged to take their cases to these in the first instance

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Lack of transparency about statistics
6.66 The PCC has not been transparent about its own performance and the performance of newspapers. Figures published purporting to demonstrate both were not easy to understand,187 meaning that the public could not readily assess the performance of the PCC in particular or of the newspapers which came into contact with it. Throughout there is an imprecision as to the use of language which obscures meaning. The words ‘ruling’, ‘decision’, ‘adjudication’ and ‘resolution’ are nowhere defined and appear to be used interchangeably. Mr Toulmin was taken at length through the statistics for 2007 (this year chosen at random to illustrate the point). From these, it was difficult to understand: (a) (b) (c) (d) 6.67 the basis for sifting out approximately 50% of complaints at the first stage; the basis on which complaints were assessed as raising a prima facie issue under the Code at the second stage; what was meant by the term ‘rulings’ in this second context given that so many complaints were thereafter mediated to a compromise; and the exact basis on which certain complaints went forward to adjudication.188

This lack of transparency is strikingly thrown into relief by a comparison between two separate pieces of data. In January 2011, just after the departure of the Northern & Shell titles from the system, the director of the PCC wrote an internal memorandum to the Commissioners informing them of the ramifications.189 This stated as follows: “In 2009 the PCC received 719 complaints about Express titles...It made 140 rulings, including 52 occasions where there was a breach of the Code that required remedial action. These are significant complaints figures (in comparison all News International titles produced 790 complaints, 292 rulings and 90 breaches of the Code. The complaints also tend to focus on controversial issues such as immigration, and often cluster around articles that cause particular and widespread comment...”

6.68

A number of points need to be made about this. First, a comparison between these unpublished data and the PCC’s published statistics190 shows a stark discrepancy: for example, whereas the former demonstrate that the PCC apparently upheld 142 breaches of the Code in relation to two publishers alone, the latter appear to show a much lower figure. Furthermore, the PCC appears to be in a position whereby complaints statistics can be given on a publisher specific basis. The clear inference is that more could be done to explain the position to the public.

pp92-98, paras 219-235, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf; Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E1. pdf; Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E2.pdf; Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E3.pdf; Stephen Abell, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E4.pdf; Stephen Abell, http://www.levesoninquiry.org. uk/wp-content/uploads/2012/01/Exhibit-SA-E4.pdf; Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/01/Exhibit-SA-E5.pdf; Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/ Exhibit-SA-E6.pdf; Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E72. pdf; Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E8.pdf; Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-E9.pdf; pp1 – 33, http://www. levesoninquiry.org.uk/wp-content/uploads/2012/02/Second-Submission-by-Media-Standards-Trust.pdf 188 p57, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of-Morning-Hearing30-January-2012.pdf 189 p4, para 1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-S5.pdf 190 see Table D2.2, Part D, Chapter 2

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6.69

Overall, these statistics as presented in the Annual Reviews have tended to underplay the significance of mediation as the centre piece of the PCC’s work as well as to obscure the fact that many so called ‘prima facie’ breaches of the Code were, in fact, likely breaches. Further, the PCC have failed to publish aggregate figures for complaints made against newspapers, meaning that neither the public nor policy-makers could get any idea of which publications were most regularly in breach of the Editors’ Code of Conduct. In any event, any newspapers who adopted a strategy of settling complaints at a late stage (by which time the merits of the complaints would have been clear) in order to avoid adverse adjudications would not be accurately represented in any league table. Although it is not clear why this practice was adopted, what is clear is that it worked to the advantage of the industry, who could point to near unblemished records in relation to breaches of the Editors’ Code of Practice; the evidence as revealed in Mr Abell’s memorandum to the Commission was, in fact, manifestly different.

Prominence of the organisation
6.70 A number of commentators have observed that the public profile of the PCC has been too low. However, I have heard little evidence on this matter and will restrict myself to few comments in this respect. The evidence shows that the PCC has had some difficulty in publicising itself and the work that it did. Certainly, the PCC made some efforts to raise its profile, first by asking publications to donate space both in print editions and online to publicising the work of the PCC; and also by engaging in profile raising events around the country. Under the Chairmanship of Lord Wakeham, this was done through seeking out high profile complainants, thereby raising the profile of the organisation when it was reported that such a complainant had used the services of the PCC. In Lord Wakeham’s view the failure in recent years to attract high-profile complainants has been a real weakness of the system and has contributed to the loss of confidence among the public more generally:191 “…the respect of the PCC has gone down in recent years because they haven’t had the high-profile complaints they used to have, and the high-profile complainers say ‘we would sooner take the matter to the courts’” therefore the PCC doesn’t deal with them, the PCC’s standing goes down…” 6.72 Other senior figures at the PCC also recognised that the lack of prominence in the public mind was a serious problem which hindered the organisation from doing its work. Mr Toulmin, said in evidence to the Inquiry that:192 “…one of the things that used to strike me, and upset me…was hearing from members of the public who had a perfectly reasonable complaint to make or we could have helped in some way stopping harassment or helping them with their difficulty and they’d never heard of the PCC … although it does have quite a high name recognition, it’s by no means universal, and the newspaper and magazine industry is in a very good position to refer prominently to the existence of this organisation, and whilst they did do some good work and they published numerous free adverts at obviously expense to themselves, their regular references to the PCC were much less impressive, I thought, than they could have been”.
pp34-35, lines 24-5, Lord Wakeham, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Transcript-ofMorning-Hearing-15-May-2012.pdf 192 pp36-37, lines 23-12, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-30-January-2012.pdf
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6.73

However, it must be acknowledged that this is not a new issue. For example in August 2004, there was an exchange of letters between Sir Brian Cubbon, then Chair of the PCC Charter Compliance Panel, and Sir Christopher, concerning the very same question of prominence and publicity being given to the PCC.193 In this respect, I understand Mr Toulmin’s point; it is well made. It cannot simply be the responsibility of the PCC or the self-regulatory system itself to raise the PCC’s profile by attracting well known complainants or otherwise publicising its work. In any event, seeking to attract well known complainants might be thought to be making assumptions about the validity of complaints that they might wish to make: to attract a complaint that is then dismissed would hardly encourage others. The press could and should have done more to assist with that project so that no potential complainant was left in ignorance of the existence of the PCC or of the services it could offer.

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7. Investigatory failures
7.1 In this section of this Chapter I will examine the PCC’s response, or rather the lack of it, to Operation Motorman before moving to an assessment of the reports of 2007 and 2009 into phone hacking.

Operation Motorman
7.2 The narrative of the detailed discussions that took place between the PCC and the industry on the one hand and the Information Commissione’s Office (ICO), on the other is considered in various Parts and Chapters of this Report.194 and it is unnecessary to revisit the history. Although the involvement of the PCC has been covered, this has been largely through the lens of the Information Commissioner. I take this opportunity to review the matter briefly through the prism of the PCC. Richard Thomas, the former Information Commissioner, approached the PCC in the belief that it was the industry regulator. He thus applied to the PCC for assistance in putting a stop to the use by the press of private investigators using illegal techniques to obtain private data. He was hoping, if not expecting, that the PCC might achieve this by way of a general condemnation of the practice, and securing appropriate changes to the Editors’ Code.195 Mr Thomas’ belief was a misapprehension that the PCC was a regulator; and, indeed, this was one of a number of concerns raised by Sir Christopher about the expectations and helpfulness of the Information Commissioner. Sir Christopher told the Inquiry that at their first meeting, in November 2003, Mr Thomas appeared to be labouring under the misapprehension that the PCC had the ability to enforce the criminal law,196 which of course it did not. Even a selfregulator properly so called is not able to do that.

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See p1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-C15.pdf p1, PCC http:// www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-C16.pdf pp2-3, PCC http://www.levesoninquiry. org.uk/wp-content/uploads/2012/01/Exhibit-SA-S31.pdf 194 in particular Part H 195 pp119-120, lines 25-3, Richard Thomas, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/ Transcript-of-Morning-Hearing-9-December-2011.pdf 196 p106, lines 8-11, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/ Transcript-of-Morning-Hearing-31-January-2012.pdf
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7.5

Whilst Sir Christopher was very clear with Mr Thomas that the PCC could not ‘take over’ specific cases, and that enforcing the law was for statutory bodies, not the PCC,197 nonetheless the PCC and its representatives appeared keen to present themselves as the de facto regulator for the press and the relevant body for any such discussion. Indeed, it is perhaps telling of the PCC’s desire to be regarded as regulator that Sir Christopher made no effort to disabuse Mr Thomas of this misapprehension immediately. The PCC demonstrated a willingness to play a lead role in dealing with the issue from the press perspective. This was despite the fact that, as Mr Toulmin acknowledged, that:198 “he probably came to the wrong place anyway. I think he’s accepted that. He either should have gone directly to the industry, the trade bodies, or straight to the Code Committee, possibly, which is more representative of the industry.”

7.6

7.7

Throughout, the position of the PCC was not, perhaps, as straightforward as might be expected of an industry body presented with allegations of serious wrongdoing. Sir Christopher was evidently interested in what he heard about Operation Motorman; he characterised the ICO as describing a “fairly apocalyptic situation”.199 However, Sir Christopher also wanted firm evidence. He said:200 “I wanted beef. I wanted red meat, Mr Jay, and he didn’t give it to me.”

7.8

The initial meetings between Mr Thomas and Sir Christopher, in which Sir Christopher asked for more concrete evidence and Mr Thomas declined to provide it, led to a curious state of impasse. The lack of will underpinning this slow progress is suggested in remarks made by Sir Christopher Meyer in response to questions put by Mr Jay as to whether the PCC could not simply have taken on trust the ICO’s indication of the extent of the problem without the underlying data. Sir Christopher’s answer was that while, of course, it could be assumed Mr Thomas would not have made the allegations without some substance, they never saw the substance, or the expected litigation. The position of the PCC was relatively clear, and remained constant: before they would act, they wanted details of the underlying data, and decisive action from the ICO.201 Furthermore, the PCC refused to take any action while criminal proceedings were pending or possible. This added to the inertia. How they would act should such data be forthcoming was not so clear. It is Sir Christopher’s contention that such evidence would have enabled the PCC to “have gone into some kind of action with the newspapers in question”, and to sharpen and hone their guidance to the press. Exactly, what such action would have involved is unclear, given the limited powers and room for manoeuvre open to the PCC. Certainly the request for concrete evidence sat oddly with the ICO’s request for forward looking guidance for the press on data protection issues. Indeed, given the context of the request, it is somewhat surprising that the PCC was not more forthcoming with suggestions of practical further steps.

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p1, Richard Thomas, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Exhibit-RJT61.pdf p89, lines 25-20, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-30-January-2012.pdf 199 p118, line 9, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-31-January-2012.pdf 200 p111, lines 23-24, ibid 201 p117, ibid
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7.11

Mr Toulmin said that he was very clearly of the view that the PCC was “a complaints body looking at breaches of the code of practice rather than the Data Protection Act”, and suggested that it may not even have been appropriate for the PCC to have issued any guidance on the Data Protection Act. However, if this view is correct, then it was and remains inappropriate for the PCC to have held itself out as a regulator and taken the lead in this dialogue. In evidence to the Inquiry Mr Toulmin said:202 “The question was, I think, where the different responsibilities lay. The PCC, as a platform for discussing the behaviour of journalists and so on in another context, which was about the application of the code of practice, was happy also to say, ‘By the way, Richard Thomas has this campaign about the Data Protection Act and he’s right to do so’, but beyond that, it was difficult really to know what the PCC could do.”

7.12

Mr Toulmin was undoubtedly right that, even if wrongdoing had been demonstrated, the PCC was largely powerless to act. However, it is far from clear that this message was ever communicated properly to the ICO, other than in Sir Christopher Meyer’s veiled suggestion that the ICO do more in this area. Rather, the dialogue between the organisations was conducted as if it were one of putative regulatory equals. Any acknowledgement that this was not the case came only much later. It is also quite clear that the resulting stalemate between the two regulatory bodies was to the distinct advantage of the industry: it averted any further criticism and prevented the scrutiny of what were, in some cases, clearly highly dubious practices. The PCC did work with the ICO to develop and issue guidance on compliance on the DPA. It took over 16 months from the first meeting between Mr Thomas and Sir Christopher to produce and amounted to no more than three pages of guidance that bore no relation to the ‘condemnation’ that Mr Thomas had been looking for. The guidance note provides a very basic guide to the ideas contained in the Act.203 The bulk of the note, however, is dedicated to explaining the exemption for journalistic purposes, including the fact that in considering whether a data controller’s belief was reasonable that publication was or would be in the public interest, regard may be had by the court to his compliance with the PCC Code of Practice. It then proceeds to remind the reader of what the Code says on the public interest and how the PCC has interpreted it. The note does mention that there is a specific criminal offence of unlawful obtaining of personal data. Moreover no mention whatsoever is made of the Motorman prosecutions or of the allegations that the press had been substantial customers of those prosecuted. Furthermore, there is no reference to the risks of using private investigators to obtain personal information or the need to ensure that they do so in accordance with the law. On no level could it be suggested that this guidance note was part of a strategy either to condemn unlawful data use or to warn the industry of the risks that it might be running. On the contrary, if anything the guidance note tends towards reassuring the press that there are sufficient exemptions for journalistic activity to mean that they need not even think about the issues.

7.13

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p88, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of-Morning-Hearing30-January-2012.pdf 203 PCC, Data Protection Act, Journalism and the PCC Code, http://www.pcc.org.uk/advice/editorials-detail. html?article=ODg

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7.16

There is no doubt that this was a deliberate approach on the part of the PCC, as Mr Toulmin explained:204 “Q. Would you agree there was no attempt by the PCC in 2005, through its guidance, specifically to warn the press of what they should do in the future by reference to what they might have done in the past? A. I would agree with that. I think this guidance note was what we were asked to do by the Information Commissioner. Q. Did not the PCC form its own view as to what might be appropriate, given what the Information Commissioner was saying about the scale of the activity, namely what warnings should be given? A. Well, this was regarded to be appropriate. There are arguments about whether it should even have done this, given that it was a complaints body looking at breaches of the code of practice rather than the Data Protection Act, but it did want to be helpful and this was the outcome.”

7.17

The inadequacy of this response vividly demonstrates two weaknesses in the PCC’s approach. First, despite the apparent protection of privacy afforded by clause 3 of the Code of Practice, the potential widespread use of illegal techniques to secure access to personal data does not seem to have struck the Commission as a potential breach of the Code. Secondly, this is a graphic illustration of the inability of the PCC to act as a regulator in any meaningful sense. These weaknesses in the reaction of the PCC might be explained by the fact that the PCC felt that on this issue they were unable to act without the consent of the industry.205 The efforts made by the PCC did not stop with the issuing of the guidance. Sir Christopher also made some speeches in which he touched on the issue.206 However, it is not particularly surprising that Mr Thomas was unhappy that the PCC had not done more. Eventually, on 13 July 2006, there was a meeting between the ICO and the PCC at which Mr Thomas specifically expressed his disappointment that the PCC had not been more forthright in its condemnation of what appeared to good evidence of wholesale breaches of s55 of the Data Protection Act 1998.207 Sir Christopher denied that Mr Thomas’ disappointment was justified, pointing to his speeches, interviews and the PCC’s Annual Reviews,208 but in my view it was: no formal steps had been taken by the PCC to take up this issue with the industry. Equally, Mr Thomas might well have been disappointed further when he was informed by Sir Christopher that the “PCC is not able to act as a general regulator”, the reason for this apparently being:209 “I think what I had in mind there was a notion that we should in some way take on the work of the Information Commissioner by virtue of being a Press Complaints Commission, and this is what I wanted to reject. The point I always made to Mr Thomas, apart from my insistent demands on beef, was to suggest that we had to work in a

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pp84-85, lines 10-2, Tim Toulmin, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofMorning-Hearing-30-January-2012.pdf 205 pp88-89, lines 23-15, ibid 206 p107, lines 3-5, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Morning-Hearing-31-January-2012.pdf 207 p1, Sir Christopher Meyer, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofAfternoon-Hearing-31-January-2012.pdf 208 p1, lines 22-25, ibid 209 p2, lines 5-18, ibid

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complementary way. He did his thing, but there were things that we could do to help him, and I’ve described them in the – before lunch. And I think as a consequence of this precise meeting, it led to direct contacts between the Code Committee and Mr Thomas, which led to a change in clause 10 on subterfuge in the code of practice.” 7.20 This introduces a further issue, which relates to the distinction between the PCC and the Editors’ Code of Practice Committee. This was a distinction which, without some words of explanation from Sir Christopher, appears to have been was completely (and understandably) lost on Mr Thomas. No such explanation was forthcoming when the matter was first discussed in November 2003; it was only given in July 2006. Sir Christopher was asked why he did not himself raise the issue directly with that Committee rather than leaving it to Mr Thomas to make direct contact. He replied:210 “...I thought actually this would be helpful. Rather than mediating his contacts with the Code Committee on the matter of clause 10, the very best thing he could do was to speak to them directly. It was a kind of obvious, common sense practical thing to do, to which he raised no objection, and which bore fruit. Q. But is this not another example of you adopting a somewhat minimalist approach, leaving it to Mr Thomas to have dealings with, in effect, your own Code of Practice Committee? A. If that is minimalism, that is a strange concept, considering the amount of effort we had made to exhort journalists to obey the Data Protection Act, without ever having been given evidence of which journalists and which newspapers had committed sins. So I think that – what was this, our third meeting with Mr Thomas, I believe? Yes, third. It might have been fourth but I think it was third. It was a thoroughly positive and constructive thing to do, which bore fruit.” 7.21 It would have been helpful had Mr Thomas been appropriately advised of the position much earlier. Sir Christopher could and should have raised the matter with the Code Committee shortly after the first meeting in November 2003; alternatively a joint approach could have been organised. Sir Christopher’s third concern was that the ICO failed to provide him with hard evidence (‘the beef’) of criminality by individual journalists and titles. This was a point which he had developed at some length before the Select Committee, and which was probed before the Inquiry in a series of questions:211 “Q. The next question and final question on the ICO issue is one which others, I know, want me to put. You get the second report. You get the table in the second report. The Daily Mail happens to be top of the list but maybe it doesn’t matter precisely who it is. Why don’t you call in the editor, or one of the editors or some of the editors near the top of the list, and ask for an explanation? A. I was not in the business of calling in editors to explain actions that were perfectly legal. The beef had to be an indication of which newspapers and which journalists had actually hired inquiry agents to procure information illegally. Then we would have been in a different ball game, but we never got there. Q. But that’s a misunderstanding, I think, Sir Christopher, of the table in the second report. The table in the second report evidenced, in Mr Thomas’ view, probably illegal
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transactions. So the point I’m putting to you is: on the basis of that table alone and assuming that Mr Thomas it is acting in good faith and has evidence, as he must be doing, why not call in some editors and ask for an explanation? A. He can have all the good faith in the world, but like the chairman of the Select Committee himself, I wanted to see the beef. Then we had something to say to the editors. And it wasn’t just me; it was also the Select Committee itself wanted to know the answer. He couldn’t He couldn’t give it. So by definition, there was a limit to what could have been done.” 7.23 The ICO’s second report in particular had clearly explained the basis for the conclusion that the transactions tabulated in Table 6 were likely to be in breach of s55 of the Data Protection Act. The newspapers at the top of the table were plainly identified for all to see. Sir Christopher had enough ‘beef’ to take these matters up with the editors involved had he chosen to do so, but he did not. I regret that I have a very real concern that even had Mr Thomas supplied the extra slices of evidential beef which might have satisfied Sir Christopher (by some detail) little or nothing would have been done with it, perhaps because of the absence of first hand complaint. The PCC after all lacked the powers to operate as a ‘general regulator’, and Sir Christopher is unlikely to have knocked on the doors of the editors involved seeking their explanations. In my view, the critical fallout from the Operation Motorman episode is not confined to the ICO; it embraces the PCC, for the reasons I have explained. As a whole, the industry response to Operation Motorman, led by the PCC, replicated the pattern of disinterest, intransigence and inertia with which the industry has historically met criticism.

7.24

Phone hacking: what powers did the PCC have and what role should they have played?
7.25 Lord Wakeham testified that he did not view it as part of the role of the PCC to investigate criminal or potentially criminal allegations. He described the stance taken by the PCC under his chairmanship as follows:212 “[I] never considered it was my role to look into allegations of criminality or illegality. Quite apart from the practical implications of trying to run a quasi-police operation, we never had the powers to do so. When matters of a suspicious nature came up we therefore declined to deal with them and referred them to the relevant authorities to take them up.” 7.26 A similar point was made by Baroness Buscombe in her evidence to the Inquiry. She said that “we [the PCC] have neither the locus, or power to intervene. We were very clear that we could not duplicate the work of the CPS of the police”.213 She characterised the intervention of the PCC as an effort to try to meet public concern about phone hacking and journalistic ethics generally:214 “What is sometimes lost in this issue is that the PCC, in trying in 2009 to meet rising public concern about events at News International exceeded its remit. It is an open
p2, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/05/Witness-Statement-of-Lord-Wakeham. pdf 213 p13, para 82, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-BaronessBuscombe1.pdf 214 p13, para 83, ibid
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question as to whether the PCC would now be better placed if it has made publicly clear in 2009 that it was in no position sensibly to examine the charges made about News International”. 7.27 This has the appearance of amounting to a form of special pleading. The PCC had previously reassured Parliamentarians that the issue of hacking or listening into private conversations had been addressed. In a submission to the CMS Select Committee in 2003, the PCC wrote that:215 “One area of general concern in the early 1990s was the apparent reliance by some newspapers on material that appeared to have been obtained as a result of bugging or eavesdropping on telephone exchanges. Section B 2 [of the submission] outlines how the Code Committee reacted to this concern by introducing, in 1993, a rule forbidding such practices in the absence of a public interest. Since then only one breach of the Code has been brought to the Commission s attention – in 1996 – which clearly shows how the Code can change newspaper behaviour. Since the breach in 1996 there have been no others”. 7.28 There is no reason why in principle the PCC should not have investigated or sought to publish a report into allegations of phone hacking. There were no pitfalls so long as the PCC was clear and open about the extent of the powers it had, the extent of the investigations it was able to carry out, and the nature of the investigations it had carried out. The 2007 and 2009 investigations, leading to the reports respectively entitled “Report on Subterfuge and Newsgathering” and “Report on Phone Message Tapping Allegations”, both suffered from similar flaws. Ignoring the issue as to its ability to obtain accurate answers, the PCC did not ask the right questions to discover the true extent of the practice of phone hacking, or whether it was more widespread than had previously emerged; neither did it pay sufficient attention to evidence which suggested that what was being asserted was not the full picture. In both reports, the PCC concluded that there was no evidence that phone hacking was widespread, when at best it should have expressed itself in far more non-committal (if not wholly non committal) terms. In the 2009 report, there was the additional feature of the belittling of those who were contending that hacking was widespread.

7.29

2007 investigation
7.30 The PCC made a press statement on phone hacking in August 2006. In that statement the PCC made it clear that, in line with Article 53(3)(c) of its Articles of Association, it would not investigate or comment on the issue of phone hacking before the conclusion of the police investigation into Glenn Mulcaire and Clive Goodman. It did however reserve the right to launch an investigation following the conclusion of that investigation.216 The PCC also referred to its own 2003 decision in the case of Foster v The Sun, in which The Sun admitted that it had printed transcripts of tapped phone conversations between the businessman Peter Foster and his mother at the height of controversy relating to Cherie Blair’s purchase of property in Bristol.217

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p68, para 20, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-R11.pdf p1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U1.pdf 217 pp377-378, paras 638-639, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Witness-Statement-ofStephen-Abell.pdf
216

215

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7.31

On 1 February 2007 the PCC announced the action that it would be taking following the conviction of Messrs Goodman and Mulcaire.218 Sir Christopher Meyer announced that the PCC would be taking steps to ensure that the public could be satisfied “that lessons have been learned from this episode, both at the newspaper and more generally”.219 The PCC committed to explore three things: “First, we are writing to the new editor of the News of the World with a number of questions, including what he will be doing to ensure that the situation involving Mr Goodman and Mr Mulcaire does not recur. Second, we will be writing to the editors of national and regional newspapers and magazines to find out the extent of internal controls aimed at preventing intrusive fishing expeditions; and what is being done to instil understanding both of the Code of Practice and the law in this area, and also of journalistic public interest exemptions. The Data Protection Act has an obvious relevance here. Third, the board of the Commission will consider these industry responses with a view to publishing a review of the current situation, with recommendations for best practice if necessary, in order to prevent a similar situation arising in the future. This is in line with its duty to promote high professional standards of journalism.”

7.32

The 2007 investigation was primarily forward looking. The PCC did not set out to discover whether the type of illegal activity which Messrs Goodman and Mulcaire had engaged in was more widespread than the activity of a single rogue reporter in a single newspaper. The PCC chose not to engage in a more wide-ranging investigation despite the sentencing remarks of Mr Justice Gross which referred to contact between Mr Mulcaire and “others” at the News of the World;220 and the allegation from the Daily Mail that Mr Mulcaire was being paid £200,000 per annum by the NoTW.221 As a first step in the investigation, Mr Tim Toulmin wrote to Mr Myler on 7 February 2007.222 He asked Mr Myler a series of questions arising from the prosecution of Mr Goodman and Mr Mulcaire. There was a particular focus on whether or not the employment of a third party, i.e. Mr Mulcaire, had been an attempt to circumvent the provisions of the Editors’ Code of Conduct. The questioning also focussed on whether internal procedures had been tightened up since the detection of Mr Goodman’s activities, to prevent any repeat. In line with the general approach of this investigation, Mr Toulmin’s letter did not seek to explore whether the practice of phone hacking or any other invasions of privacy was more widespread within the NoTW than had previously emerged. While the PCC questions were not directed to the question of whether phone hacking was more widespread than had previously emerged, Mr Myler took pains to emphasise that phone hacking was an activity engaged in only by Mr Goodman:223 “Although, as I said earlier, there can be no question of complacency, this was an exceptional and unhappy event in the 163 years of history of News of the World, involving one journalist.”

7.33

7.34

7.35

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218 219

p1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U3.pdf ibid 220 See sentencing remarks of Mr Justice Gross in R v Glenn Mulcaire and Clive Goodman, 2007, Central Criminal Court 221 p1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U2.pdf 222 pp1-2, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U4.pdf 223 p9, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U5.pdf, Colin Myler’s evidence, p42, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Transcript-of-Morning-Hearing-15December-20111.pdf

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7.36

He also informed the PCC that “I do believe that Mr Mulcaire was operating in a confined environment run by Clive Goodman”’224 Mr Myler’s assertion to the PCC was that Mr Muclaire had been engaged by the NoTW to carry out legitimate searches and investigations, and then retained separately by Mr Goodman to carry out illegal phone hacking.225 Mr Myler further asserted that the illegal aspect of Mr Mulcaire’s activities had been completely unknown to anyone at the NoTW other than Mr Goodman.226 The PCC did not interview the former editor of the NoTW, Andy Coulson, in its preparation for the 2007 report or indeed ask him to provide written evidence to the investigation. It is surprising that the PCC was content to direct its questions at Mr Myler, a man who had only taken over as editor of the NoTW a matter of weeks before answering the PCC’s questions; had never worked there before, and until he took over as editor of the NoTW had been living and working in New York. In the 2007 report, the reason given for the failure to interview or otherwise question Mr Coulson was that he had resigned from the editorship of the NoTW and therefore no longer came under the PCC’s jurisdiction:227 “Given that the PCC does not – and should not – have statutory powers of investigation and prosecution, there could be no question of trying to duplicate the lengthy police investigation. Furthermore, Mr Coulson was, following his resignation, no longer answerable to the PCC, whose jurisdiction covers journalists working for publications that subscribe to the self-regulatory system through the Press Standards Board of Finance.”

7.37

7.38

The first of these points may go to the question of what the PCC should investigate, and how it should do so. It has no bearing on whether or not Mr Coulson should have been interviewed or otherwise questioned. The second point, that Mr Coulson was no longer employed by a publication subscribing to PressBoF, has no merit either. There was nothing to prevent the PCC from asking Mr Coulson to answer questions, even after he had left the employment of a newspaper. The PCC had previously asked questions of journalists after their dismissal, for example in the City Slickers investigation where the PCC approached both journalists, James Hipwell and Anil Bhoyrul for information after they had been dismissed by the Daily Mirror.228 Sir Brian Cubbon, the PCC’s Charter Commissioner, recommended Mr Toulmin in an email on 1 May 2007 that Mr Coulson should be interviewed.229 If Mr Coulson had declined to answer questions the PCC might have drawn inferences from that refusal. In evidence to the Inquiry Sir Christopher said that “it might have been presentationally better”230 if Mr Coulson had been interviewed in the course of the 2007 investigation, but did not say that he believed that the 2007 report would have been better in substance. It is surprising that Sir Christopher did not believe that it would have been better from a substantive perspective had the PCC interviewed Mr Coulson. Any investigator determined to arrive at the truth would have wished to interview the editor of the newspaper at which the alleged wrongdoing took place. The process of the investigation revealed the extent to which the PCC’s capacity to operate as a standards regulator was constrained by industry control. An email from Eve Salomon, one

7.39

7.40
224 225

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p1-5, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U5.pdf p4, paras 4.5-4.6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U11.pdf 226 p5, para 4.9, PCC, ibid 227 p1, para 1.6, PCC, ibid 228 PCC, City Slickers ruling, http://www.pcc.org.uk/news/index.html?article=MTc4NQ 229 p1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U9.pdf 230 p9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-Sir-Christopher-Meyer. pdf

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of the lay commissioners at the time, to Mr Toulmin on 2 May 2007, questioned the proposal that the PCC should work to raise standards in respect of data protection within the press:231 “I remain wary, as calling newspapers generally to account like that strikes me as entering into another level of regulation. Fine if the industry wants it, but we don’t want to alienate everybody! If we do say something, my suggestion would be something like we will be contacting the industry again in 6 months to ask what changes they have made in the light of our report.” 7.41 Despite the questioning of NoTW representatives being limited to prospective changes, and the failure to draw upon material which might have indicated otherwise, at least inferentially, the 2007 report purported to come to conclusions about the prevalence of phone hacking within the industry:232 “No evidence has emerged either from the legal proceedings or the Commission’s Questions to Mr Myler and Mr Hinton of a conspiracy at the newspaper going beyond Messrs Goodman and Mulcaire to subvert the law and the PCC’s Code of Practice. There is no evidence to challenge Mr Myler’s assertion that: Goodman had deceived his employer in order to obtain cash to pay Mulcaire; that he had concealed the identity of the source of information on royal stories; and that no-one else at the News of the World knew that Messrs Goodman and Mulcaire were tapping phone messages for stories.” 7.42 Later in the 2007 report, the PCC once again appeared to accept the position that phone hacking was limited to those who had already been prosecuted, saying that “[t]he Commission’s role here has been additional to the law, which has already investigated, prosecuted and punished the people responsible for the phone message tapping.”233 The PCC did not ask questions designed to find out whether or not phone hacking had been more widespread than originally supposed. Instead, the 2007 report appeared to exonerate the NoTW from any suggestion that phone hacking had been more widespread than acknowledged. The PCC also used the report as an opportunity to continue its advocacy against the introduction of custodial sentences for breaches of s55 of the Data Protection Act. Having suggested a number of steps which should be taken by newspapers to prevent abuses in the form of obtaining private data generally,234 the PCC concluded that:235 “The Commission believes very strongly that the impact of these initiatives should be assessed before the government proceeds with its proposals to increase the penalties for journalists who breach the DPA to two years in prison. Such a move would be difficult to reconcile with notions of press freedom. The mere threat of a custodial sentence could be enough to deter journalists from embarking on legitimate investigations, despite reassurances about the public interest exemptions from the Information Commissioner.”

7.43

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7.44
231 232

Press coverage of the 2007 report shows that one of the main points which, at least press observers (some of whom might be thought to have had something of a vested interest

p1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-U10.pdf p7, para 6.3, Press Board of Finance, https://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ExhibitPbof-54.pdf 233 p8, para 6.7, Press Board of Finance, https://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ExhibitPbof-54.pdf 234 p11, para 10.5, ibid 235 p11, para 10.4, ibid

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of sorts) took from it was that the PCC had exonerated the NoTW from any suspicion that hacking was more widespread than had been conceded. Under the headline “News of the World in the clear over Clive Goodman case”, an article in the Guardian dated 18 May 2007 reported that:236 “The Press Complaints Commission has effectively cleared the News of the World of any illegal conspiracy in the Clive Goodman royal phone hacking scandal.” 7.45 The effect of the PCC’s 2007 report was to take the heat out of calls for further investigation or reform of the system of self-regulation. In November 2007 Sir Christopher wrote to Tim Bowdler, then Chairman of PressBoF, in the following terms:237 “I have to say that … I was extremely worried by the possible political fall-out from the Goodman/Mulcaire case and the damage this could do to self-regulation. [The PCC’s report into Subterfuge and Newsgathering] put a premium on responding fast, comprehensively and effectively. Despite some carping at our decision not to interview Andy Coulson, the report has gone down well, effectively killing the case as an issue in Westminster and Whitehall. It has, as you know, been welcomed by the Government, the Opposition and the Select Committee; and, I believe, has contributed to the current and welcome bipartisan consensus behind self-regulation and against a privacy law, buttressed by the Prime Minister himself.” 7.46 It is frankly difficult to avoid the conclusion that with the publication of the Report on Subterfuge and Newsgathering, not only was yet another chance for the self-regulatory system to reform itself was missed, but the PCC actively attempted to avoid external scrutiny that might have increased pressure for reform of the system from elsewhere.

2009 investigation
7.47 On 9 July 2009, the Guardian published an article entitled “Revealed: Murdoch’s £1m bill for hiding dirty tricks.”238 The substance of the article was that News Group Newspapers (NGN) had paid over the odds to settle phone hacking cases in order to try to secure confidentiality. The article revealed that one of the cases involved Gordon Taylor, the former Chief Executive of the Professional Footballers Association. In a separate comment piece printed in the Guardian on the same day, Mr Davies challenged the ‘one rogue reporter’ defence which had been advanced by News Group Newspapers (NGN) since the allegations about Clive Goodman’s conduct were revealed. In response to the allegations, the PCC issued a press statement announcing that it would seek further information about the allegations from the Guardian and from the Information Commissioner.239 The PCC did so and eventually prepared a report based on those findings published on 9 November 2009.240 The report was drafted by Mr Toulmin, with the conclusions in particular being approved by the Commission collectively.241 The 2009 report was withdrawn on 6 July 2011.

7.48

Stephen Brook, News of the World in the clear over Clive Goodman case, 18 May 2007, http://www.guardian.co.uk/ media/2007/may/18/newsoftheworld.pressandpublishing 237 p2, Press Board of Finance, https://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Exhibit-Pbof-79.pdf 238 Published in the Guardian on 08 July 2009, in the online edition, available at: Nick Davies, Revealed: Murdoch’s £1m bill for hiding dirty tricks, 09 July 2009, http://www.nickdavies.net/2009/07/09/murdochs-1m-bill-for-hiding-dirtytricks/ 239 p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/SA-B164.pdf 240 PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V21.pdf 241 pp48-49, lines 10-2, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/ Transcript-of-Morning-Hearing-7-February-2012.pdf

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Why the PCC investigated 7.49 By 2009, senior figures at the PCC felt obliged to try to assume the responsibilities of a regulator in relation to the phone hacking allegations which had, by then, grown in volume. Baroness Buscombe gave evidence that she felt obliged to make some sort of intervention because there was nobody else able to fulfil that role:242 “Q. …you might have said ‘This is really only a complaints mechanism. This is nothing about regulation’” A…at the time we felt that we did have a regulatory role…to perform. There was nothing else. There were no other layers that were, at the time, coming into play”. The Investigation 7.50 The 2009 report sought to answer two questions. First, whether the PCC had been misled when preparing the 2007 report and in particular whether there was any evidence that phone hacking was not confined to the single rogue reporter, Mr Goodman, acting through the agency of Mr Mulcaire. Secondly, the PCC sought to establish whether there was any evidence that phone message tapping had occurred since 2007. Mr Toulmin wrote Mr Myler on two occasions in the course of the 2009 investigation: on 27 July 2009243 and 3 September 2009.244 The first letter asked a series of questions which included references to: (a) the sentencing remarks of Mr Justice Gross in which the judge referred to Mr Mulcaire dealing with individuals at News International (NI) other than Mr Goodman; (b) the ‘for Neville’ email; (c) internal investigations at the NoTW following the arrest of Mr Goodman and Mr Mulcaire in 2006; (d) payments in relation to information supplied by Mr Mulcaire about Gordon Taylor; (e) whether the NoTW still believed that the ‘single rogue reporter’ line was the correct interpretation of events. Mr Myler sent a response on behalf of NGN by letter dated 5 August 2009.245 The substance of Mr Myler’s response was that the NoTW still believed that phone message tapping was the act of a single rogue reporter. Mr Myler dealt with the ‘for Neville’ email in the following way:246 “Our internal enquiries have found no evidence of involvement by News of the World staff other than Clive Goodman in phone message interception beyond the email transcript which emerged in April 2008 during the Gordon Taylor litigation and which has since been revealed in the original Guardian report… Email searches of relevant people, particularly the junior reporter [who sent the ‘for Neville’ email], [REDACTED] and [REDACTED] failed to show any trace of the email being sent to or received by any other News of the World staff member.

7.51 7.52

7.53

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242 243

Those who might have been connected to the relevant story, particularly [REDACTED] and [REDACTED], denied ever having seen or knowing about the relevant email and no evidence has been found which contradicts these assertions.”
p51, lines 4-10, ibid http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V12.pdf 244 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V15.pdf 245 pp1-16, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V14.pdf 246 p2, PCC, ibid

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7.54

Later in the same letter, Mr Myler responded to the direct question about why an email with the transcript of a message from Mr Taylor’s phone was entitled ‘for Neville’. Mr Myler gave the following response:247 “From June 2001 to April 2003 [REDACTED]... During that time Glenn Mulcaire was hired to provide numerous services including land registry checks, credit status checks, electoral roll checks, directorship searches, court record checks, surveillance, and the provision of telephone numbers of sports stars from his vast database of personal contacts.”

7.55

It is surprising that Mr Myler’s reply did not prompt further enquiries by the PCC. Given the ongoing criminal investigations, it is inappropriate for me to be too specific, but to explain the ‘for Neville’ email in the context of Mr Mulcaire’s supposedly legitimate work for the NoTW appears to make little sense, given that there was the transcript of a hacked phone message attached. The failure to pick up on the inadequacy of this response and to seek to probe further was a clear flaw in the PCC’s investigation. The PCC asked about Mr Justice Gross’s sentencing remarks both in the first letter dated 27 July 2009 and in the second letter dated 3 September 2009. In his letter of 5 August, Mr Myler gave a short response to the point, saying that the NoTW could not explain to what Mr Justice Gross was referring.248 In his reply to the second letter, Mr Myler simply said that Mr Mulcaire had had contact with several NoTW reporters on the point.249 The PCC did not have power to compel anyone to disclose relevant documents or to gain access to relevant records. Nor did they ask for any such documents or access. Further, when investigating whether or not they had been misled in 2007, the PCC relied on the honesty and thoroughness of executives at the organisation alleged to have misled them. The PCC press release covering the publication of the 2009 report, issued on 9 November 2009, contained the following paragraph:250 “The PCC received information from a number of sources. It found no evidence that it was materially misled by the News of the World, and no evidence that phone message hacking is ongoing. The Guardian’s sources suggesting a greater culture of intrusion at the News of the World were anonymous and could not be tested, while the Commission noted that there were ‘a significant number of on the record statements from those who have conducted inquiries, and have first-hand knowledge of events at the newspaper’ who were prepared to state a contrary position.”

7.56

7.57

7.58

7.59

In addition to asking questions of Mr Myler, the PCC also asked for evidence from the solicitor Mark Lewis,251 from Mr Davies,252 from Mick Gorrill of the Information Commissioner’s Office,253 and from Mark Maberly, the policeman with whom Mr Lewis had had a conversation about the extent of phone hacking.254 Mr Maberly did not respond. The PCC also had access to the evidence given by, among others, Mr Lewis and Mr Davies to the CMS Select Committee in

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pp3-4, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V14.pdf p3, PCC, ibid 249 p267, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V19.pdf 250 p1, Stephen Abell, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/SA-B182.pdf 251 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V110.pdf 252 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V16.pdf 253 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V17.pdf 254 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V111.pdf

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which both gave their reasons for believing that phone hacking was more widespread than had previously emerged.255 7.60 The PCC also relied upon the public statements of Assistant Commissioners John Yates and Andy Hayman.256 The evidence of the police that there had only been a handful of phone hacking victims was set against the evidence from, among others, Mr Lewis that there had been up to 6,000.257 Of course, the number of alleged victims was closely linked to the issue of how many perpetrators there had been. Mr Davies, among other things, told the PCC that he was not able to reveal all of the sources of his stories about the extent of phone hacking because of the fear voiced by some people when dealing with a powerful organisation such as NI.258 Mr Gorrill was not able to supply the PCC with information flowing from the Motorman investigation because the information seized was personal information.259 The PCC did not ask for disclosure of documents from the NoTW, or any other form of documentary evidence. Whereas there was no formal power allowing the PCC to demand disclosure of key documents from NGN, there was nothing to stop the PCC asking to see such documents. Had NGN refused, it was open to the PCC to make that public, and take any such refusal into account when publishing its conclusions on the back of the 2009 investigation. The 2009 report concluded:260 “The PCC has seen no new evidence to suggest that the practice of phone message tapping was undertaken by others beyond Goodman and Mulcaire, or evidence that News of the World executives knew about Goodman and Mulcaire’s activities. It follows that there is nothing to suggest that the PCC was materially misled during its 2007 inquiry”. 7.64 The 2009 report’s conclusions preferred the accounts of the police to the allegations of widespread phone hacking contained in the Guardian:261 “Set against the Guardian’s anonymous sources are a significant number of on the record statements from those who have conducted inquiries, and have first hand knowledge of events at the newspaper. While people may speculate about the email referencing ‘Neville’, the Taylor settlement, and the termination payments to Mulcaire and Goodman, the PCC can only deal with facts available rather than make assumptions.” 7.65 The 2009 report concluded by observing that:262 “…the Commission could not help but conclude that the Guardian’s stories did not quite live up to the dramatic billing they were initially given. Perhaps this was because the sources could not be tested; or because Nick Davies was unable to shed further light of the suggestions of a broader conspiracy at the newspaper; or because there was significant evidence to the contrary from the police; or because much of the
255 256

7.61

7.62

7.63

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http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V19.pdf pp5, 7-8, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V21.pdf 257 p2, para 5, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V112.pdf 258 p118, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V112.pdf 259 p1, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V18.pdf 260 p9, para 13.2, PCC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V21.pdf 261 ibid 262 ibid

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information was old and had already appeared in the public domain (or a combination of these factors). Whatever the reason, there did not seem to be anything concrete to support the implication that there had been a hitherto concealed criminal conspiracy at the News of the World to intrude into people’s privacy”. 7.66 The PCC might reasonably have concluded that there was insufficient evidence for it firmly to say that its investigation in 2007 had been misled. However, to conclude that there was nothing to suggest that the 2007 investigation had been misled was to ignore at least four significant facts from which inferences might reasonably have been drawn casting doubt on the ‘one rogue reporter’ defence. The first of these facts was the so called ‘for Neville’ email. The second was Mr Taylor’s settlement which was for a very large (some might say an astonishingly large) sum. Third, evidence from Mr Lewis of his conversation with a police officer suggesting that phone message tapping was much more widespread than had previously been made public. Fourth, there were the sentencing remarks of Mr Justice Gross in the Goodman and Mulcaire prosecution (to which one might add the words of both prosecuting and defence counsel). It would have been reasonable for the PCC to conclude that none of these facts, taken individually or collectively, proved for certain that it had been misled in the course of their 2007 investigation, but there was certainly reason to believe that it might have been. On the question of whether there was ongoing phone message interception, the 2009 report concluded that:263 “…there is no evidence that the practice of phone message tapping is ongoing. The Commission is satisfied that – so far as it is possible to tell – its work aimed at improving the integrity of undercover journalism has played its part in raising standards in this area”. 7.69 Baroness Buscombe gave evidence that she was not comfortable with the conclusion reached in the 2009 Report that “the Guardian’s stories did not quite live up to the dramatic billing they were initially given”.264 However, she was equally uncomfortable about the PCC failing to come to a conclusion:265 “If we’d done nothing…and I know some have said we should just have said, ‘Sorry we can’t do anything.’ I’ve tried to imagine the reaction if we’d said that and we’re calling ourselves the PCC and we’re trying to be credible. I thought – unless we can probably [sic] investigate, perhaps we shouldn’t have done anything, but on the other hand if we’d done nothing we would have been accused of being useless for doing nothing. It’s very, very difficult”. Reaction to the 2009 report 7.70 There was a strong response to the 2009 Report from the Guardian. Editor in Chief, Alan Rusbridger, resigned from the Editors’ Code Committee in protest. Mr Davies gave evidence that the 2009 report caused him to change from being a supporter of the self-regulatory system to being an opponent:266

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PCC, p10, para 13.5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V21.pdf PCC, p9, para 13.3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V21.pdf 265 pp50-51, Baroness Buscombe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-ofMorning-Hearing-7-February-2012.pdf 266 pp95-96, lines 25-24, Nick Davies, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-ofMorning-Hearing-29-November-2011.pdf
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“We published the Gordon Taylor story in July, and in November, the PCC published the second report on phone hacking. Different personnel, different chair. The former – well, I think the same director, but the man who is now director was involved in the production of that report, Stephen Abell, who I regard as a good man. But the report was terrible. Just an awful piece of work. You know, my editor resigned from the code committee in protest. He went on the radio and said, ‘This is worse than useless’, which I think was an understatement. And that shifted me across the line. I just think – I do not trust this industry to regulate itself. I say this as I love reporting. I want us to be free … But it obviously doesn’t work. We’re kidding ourselves if we think it would, because it hasn’t. Q. This is the report, which is no longer on the PCC website, which referred to, I paraphrase, some of the Guardian’s more dramatic claims not being borne out by the evidence or words to that effect? A. Yes, and along the way there was some slippery behaviour, slippery handling of evidence.” 7.71 Thus the effect of the 2009 investigation was to alienate and anger the sole newspaper which had taken this issue seriously. The report and a subsequent speech by Baroness Buscombe to the Society of Editors,267 also angered Mr Taylor’s former solicitor Mr Lewis to the extent that he successfully pursued proceedings for libel. It was not too late, even in 2009, for the PCC to have been more open with the public and to have said that it lacked the powers and was not competent to carry out an effective investigation into allegations of phone hacking. That would have avoided the danger that politicians, the public and potential claimants might conclude that a competent regulator had investigated the allegations and found them to be baseless. It is completely unconvincing to contend that the PCC had to be seen to do something in order to maintain public confidence in the self-regulatory system. There was no public interest in the PCC purporting to exonerate the NoTW when it did not have the proper evidence to do so, still less to uphold the values of self-regulation. In particular as regards the disparaging conclusion about the Guardian, the PCC was clearly taking an enormous risk. That risk was that the situation would speedily unravel against it if (as happened) it was contradicted by subsequent events. The immediate consequence of the PCC’s failed investigation, as with the 2007 report, was to dampen down calls for further investigation. The continued pursuit of the issue by journalists such as Mr Davies, solicitors like Mr Lewis and a handful of politicians meant that the issue would not be buried. However, the PCC’s contribution to the phone hacking saga seeped into the political arena: for example, the Prime Minister, the Rt Hon David Cameron MP, gave evidence that in deciding to employ Mr Coulson, he relied in part on the reports of the PCC.268

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8. Conclusions
8.1 The PCC is constrained by serious structural deficiencies which limit what it can do. The power of PressBoF in relation to appointments, the Code Committee and the funding of the PCC means that the PCC is far from being an independent body. The lack of universal coverage, most notably after the withdrawal of the Northern and Shell titles from the self-

pp1-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Exhibit-SA-V22.pdf Specifically the 2009 report in relation to Mr Coulson’s appointment in May 2010; p118, lines 5-21, David Cameron, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Transcript-of-Morning-Hearing-14-June-2012.pdf
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regulatory system in January 2011, gave cause for observers and complainants to lose faith in the system.269 8.2 The PCC is barely given enough money to perform its key function of complaints handling, let alone to expand its activities in order to raise standards across the board. Funding has been an issue for some time; almost a decade ago the CMS Select Committee recommended that PressBoF heed a plea from Sir Christopher for additional funding.270 In more recent years Baroness Buscombe was obviously concerned about funding levels but does not appear to have made formal requests for additional funding.271 The PCC has been seen to associate itself with the interests of the press, has lobbied for the press on key policy issues, and has acted as a shield against moves which might threaten the status quo. Minor changes to the Editors’ Code of Practice and the self-regulatory system has been deployed as a substitute for real, substantial reform which might have improved press standards and provided a real basis for trust in self-regulation. The PCC has expressed a willingness to listen to constructive criticism but has consistently displayed a reluctance to act upon it. The failure by the PCC to initiate its own investigations – other than in circumstances where an investigation was needed to head off criticism of the press or self-regulation – or to accept complaints from third parties across the board and on a transparent basis, has meant that the PCC is not able to act as a regulator properly so called. It has also meant that bodies representing the interests of groups or minorities cannot complain to the PCC about discriminatory or inaccurate coverage. These are points which have been repeatedly identified as a weakness in the self-regulatory system. The failure by the PCC to investigate where press actions might give rise to a criminal charge or civil claim is a limitation on its effectiveness. The resources of the police are limited; similarly, resource restraints mean that individuals often cannot afford to proceed with a civil action. Even where there were prima facie serious breaches of the Editors’ Code of Practice, the PCC typically failed to take any steps to investigate. Examples of this (including alleged payments to police officers) emerged before the CMS Select Committee in their hearings leading to the 2003 report, and the Select Committee at that stage made clear its view that the PCC should investigate allegations of this type.272 When the PCC failed to initiate an investigation over newspaper coverage of the McCann case, once again the CMS Select Committee criticised the PCC for this failure.273 That report concluded:274 “In any other industry suffering such a collective breakdown – as for example in the banking sector now – any regulator worth its salt would have instigated an enquiry. The press, indeed, would have been clamouring for it to do so. It is an indictment on the PCC’s record, that it signally failed to do so.”
p40, 42, paras 165-166, 179-180, Joint Committee on Privacy and Injunctions, http://www.publications.parliament. uk/pa/jt201012/jtselect/jtprivinj/273/273.pdf 270 p38, para 86, House of Commons Culture, Media and Sport Select Committee, http://www.publications.parliament. uk/pa/cm200203/cmselect/cmcumeds/458/458.pdf 271 para 41, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Witness-Statement-of-BaronessBuscombe1.pdf 272 pp40-42, paras 92-95, House of Commons Culture, Media and Sport Select Committee, http://www.publications. parliament.uk/pa/cm200203/cmselect/cmcumeds/458/458.pdf 273 p89, paras 364-365, House of Commons Culture, Media and Sport Select Committee, http://www.publications. parliament.uk/pa/cm200910/cmselect/cmcumeds/362/362i.pdf 274 p91, para 374, ibid
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8.7

The PCC does not have sufficient powers to investigate alleged breaches of the Code. As the Joint Committee on Privacy and Injunctions concluded, this meant that the PCC “was not equipped to deal with systemic and illegal invasions of privacy”.275 In particular, it does not have powers to demand the production of documents or to run investigations which strike at the heart of complaints. At every step it has to trust that newspapers are properly examining the issues and are not being economical with the truth. In relation to its investigations into phone hacking, it is common ground that it was misled. In addition and in any event, it did not use the powers which it had to best effect. For example, it did not initiate investigations as often as it might have done nor did it hold oral hearings to determine cases, despite having the power to. Once again, these points were picked up in the CMS Select Committee’s 2003 Report.276 The weaknesses in the PCC’s powers and its reluctance to seek to compel newspapers to get to the truth were exposed by its inaction after the ICO’s reports arising from Operation Motorman, and in the 2007 and 2009 reports into phone hacking. The PCC does not have adequate sanctions to dissuade newspapers from repeating their transgressions and satisfy complainants that the wrongs against them have been redressed. Negotiated apologies, published adjudications and letters to proprietors are not in themselves adequate to prevent reoffending. The lack of a power to fine, even in relation to serious and systemic breaches of the code, has meant that the PCC is not a body whose adjudications have force against the industry. These points have been consistently picked up in external reviews of the PCC’s performance. The CMS Select Committee’s 2003 report recommended that a system of fines be introduced, as well as a strengthening of the sanctions already in place.277 The CMS Select Committee’s 2007 report into self-regulation of the press also heard evidence that some complaints were not satisfied with the strength of sanctions; that there were not enough adjudications given, as distinct from negotiated settlements; and recommended that the issue of fines be considered further.278 The failure to identify for public consumption the number of breaches of the Code that the PCC concluded had occurred serves to preserve an erroneous impression of the level of compliance with the Code. In addition, the evidence overall demonstrates that complainants to the PCC tend to feel pressurised into accepting a negotiated settlement rather than having a decision made on whether or not there has been a breach of the Editors’ Code. This failing was identified by witnesses who gave evidence to the CMS Select Committee in preparation for their 2003 report:279 “There was a great deal of praise for the staff of the Commission in assisting complainants through the process but there was also a backdrop of frustration that nothing was going to change and nothing was going to happen to an offending newspaper. In one case, the witness encapsulated the feelings of many in saying that, even though she had, eventually, won the argument and got an apology, she

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p39, para 160, Joint Committee on Privacy and Injunctions, http://www.publications.parliament.uk/pa/jt201012/ jtselect/jtprivinj/273/273.pdf 276 p30, para 58, House of Commons Culture, Media and Sport Select Committee, http://www.publications.parliament. uk/pa/cm200203/cmselect/cmcumeds/458/458.pdf 277 pp36-38, paras 77-85 , ibid 278 pp31-33, paras 65-72, House of Commons Culture, Media and Sport Select Committee, http://www.publications. parliament.uk/pa/cm200607/cmselect/cmcumeds/375/375.pdf; pp44-45, paras 193-202, Joint Committee on Privacy and Injunctions, http://www.publications.parliament.uk/pa/jt201012/jtselect/jtprivinj/273/273.pdf 279 pp29-30, para 57, House of Commons Culture, Media and Sport Select Committee, http://www.publications. parliament.uk/pa/cm200203/cmselect/cmcumeds/458/458.pdf

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was left with the feeling that the newspaper had ‘got away with it’ (and no sense that someone else would not get the same treatment…The complainant told us: ‘I never had the sense … that at any time anybody actually sat down and made any decisions about it.’ She described the to and fro of letters and added ‘I kept saying ‘I press you to adjudicate’ … but, in fact I was pressed to accept the final offer of The Daily Mail, which was to publish an apology on page 31.’ This experience seems at odds with the PCC’s stated policy that ‘complainants can of course at any stage ask the Commission itself to take a formal view on their complaint’ Another witness described the complaints process as like climbing a staircase with ‘the Commission’ as the ‘big thing in the sky’. However, he told us ‘You get to the top of the steps, you are looking around, and ‘it’ is not there’”. 8.12 The failings which have fatally undermined the PCC and caused policy makers and the public to lose trust in the self-regulatory system are not new. They have been consistently identified by external scrutiny for at least a decade. The twin failure of both the self-regulatory system and the industry to address these problems is itself evidence that there has been no real appetite for an effective and adequate system of regulation from within the industry, in spite of a professed openness to reform and self-criticism. It is difficult to avoid the conclusion that the self-regulatory system was run for the benefit of the press not of the public. In the circumstances, it is not surprising that change is inevitable. On 9 March 2012, there was a press release to the effect that the PCC had unanimously agreed in principle to the proposal that it will now move into a transitional phase, transferring its assets, liabilities and staff to a new regulatory body.

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ChapTer 1 CriTeria for a regulaTory soluTion
1. Introduction
1.1 In order to make recommendations for a new more effective regulatory regime, as required by the Terms of Reference of the Inquiry, it is essential first to consider what a regulatory regime should be seeking to achieve. There are three aspects to this question: first, what a regulatory regime should do; second, how it should be structured to achieve that; and third, the detailed rules that are put in place to achieve the objectives. The ‘what’ is about outcomes and the ‘how’ is about processes, structures and accountabilities. The detailed rules should be dealt with in the substance of any code or regulations. These three aspects of a regulatory regime need to be considered separately as they are not necessarily dependent on each other and it may be possible to achieve the desired objectives by different combinations of solutions. This chapter is specifically about the ‘what’. In May 2012 I published on the Inquiry website a set of draft criteria for a regulatory solution that aimed to set out what any regulatory solution should seek to achieve. This was not concerned with how those outcomes should be achieved, or the structures through which they should be achieved, but simply what the outcomes should be. Those draft criteria were: “1.  Effectiveness 1.1  Any solution must be perceived as effective and credible both by the press as an  industry and by the public: (a) It must strike a balance, capable of being accepted as reasonable, legitimate and in the public interest by all. (b) It must recognise the importance for the public interest of a free press in a democracy, freedom of expression and investigative journalism, the rule of law, personal privacy and other private rights, and a press which acts responsibly and in the public interest. (c) It must promote a clear understanding of ‘the public interest’ which would be accepted as reasonable by press, industry and public alike. (d) It must be durable and sufficiently flexible to work for future markets and technology, and be capable of universal application. 2.  Fairness and objectivity of Standards 2.1  There must be a statement of ethical standards which is recognised as reasonable  by the industry and credible by the public. This statement must identify enforceable  minimum standards as well as articulating good practice that should be aimed for. 2.2  All  standards  for  good  practice  in  journalism  should  be  driven  by  the  public  interest and must be benchmarked in a clear objective way to the public interest.  2.3  The setting of standards must be independent of government and parliament,  and sufficiently independent of media interests, in order to command public respect. 3.  Independence and transparency of enforcement and compliance 3.1  Enforcement of ethical standards, by whatever mechanism, must be operationally  independent of government and parliament, and sufficiently independent of media  interests, in order to command public respect.
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3.2  In particular all relevant appointments processes must be sufficiently independent  of government, Parliament and media interests to command public support. 3.3  Compliance  must  be  the  responsibility  of  editors  and  transparent  and  demonstrable to the public. 4.  Powers and remedies 4.1  The  system  must  provide  credible  remedies,  both  in  respect  of  aggrieved  individuals and in respect of issues affecting wider groups in society. 4.2  The regulatory regime must have effective investigatory and advisory powers. 4.3  The system should also actively support and promote compliance by the industry,  both  directly  (for  example  by  providing  confidential  pre-publication  advice)  and  indirectly (for example by kitemarking titles’ own internal systems). 4.4  The  system  should  be  a  good  fit  with  other  relevant  regulatory  and  law  enforcement functions. 5.  Cost 5.1  The  solution  must  be  sufficiently  reliably  financed  to  allow  for  reasonable  operational  independence  and  appropriate  scope,  but  without  placing  a  disproportionate burden on either the industry, complainants or the taxpayer.” 1.3 I sought comments on these draft criteria. Most of those who have submitted evidence on regulation have accepted the criteria without comment. Some, including Ofcom,1 made substantive comments on the criteria, suggesting that further consideration was needed on a number of areas. Where appropriate, I address these comments later in this Chapter. I am, however, satisfied that the broad categories are correct and they continue to form the basis of what I would hope could be achieved through the recommendations set out later in this part of the Report.

2. Effectiveness
2.1 The ultimate test of any new regime is that it must work in practice, in terms of ensuring that the press comply with agreed standards. But that simple statement itself begs three questions. The first is what is meant by ‘ensuring’; the second, what is meant by ‘the press’; and the third is what is meant by ‘agreed standards’. I address all of these points in this section of the report. The Inquiry has heard over and over again that aspects of the current PCC based regime may be good in principle but that they simply do not work in practice. The essential flaws of the current regime have been examined elsewhere.2 At one fundamental level, the current ‘self-regulatory’ regime has failed to achieve continued universal coverage of the main national newspaper titles with the withdrawal of Northern and Shell. I do not consider that it is possible for a regime to be considered effective if a major national newspaper group can choose to sit outside it without consequences. This should not be a controversial view, as it essentially echoes Lord Hunt’s opinion that:3 “the credibility of the new system could be fatally undermined if any genuinely big  fish seek to escape the net.”

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http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Covering-Letter-from-Ofcom.pdf particularly in Part J, Chapter 5 3 p14, para 42, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Hunt-of-Wirral. pdf
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Lord Hunt went on to confirm that Northern and Shell would qualify as a ‘big fish’ in this context.4 The very fact that the industry has sought to put forward what it believes to be a new and fundamentally different approach to self-regulation constitutes a clear recognition that the existing regime is no longer effective. 2.2 Other aspects of external regulation, including the criminal and the civil law, have significant structural weaknesses, as is more fully discussed elsewhere in the Report.5 An effective regulatory regime will need to take account of those shortcomings and find ways of rectifying them or otherwise dealing with them as far as possible. There are a number of different aspects of effectiveness. Views on what constitutes effectiveness vary, but the broad headings included within the draft criteria have not been contested. The draft criteria indicated that, in order to be effective, a regulatory regime for the press must be accepted as credible both by the press and the public and this proposition has not been seriously disputed by anyone. This does not mean that either the industry or interest groups should have a veto over the solution, but it is important that the regime should be grounded in an understanding of the industry, the law, the rights and freedoms of both individuals and the press, and the public interest in its widest sense. A regime that fails to take any of those factors fully into account will fail to meet the expectations and needs of the public. The draft criteria set out a broad perspective on the public interest. As with the concept of effectiveness, there are many different aspects to the public interest in this context. The public interest in the freedom of the press and freedom of expression, including the public interest in a diverse and vibrant press, are the most obvious. Any regulatory regime that compromised the freedom of the press to hold authority to account, or to investigate wrongdoing by the powerful, would not qualify as effective according to any reasonable person’s definition of that term. The public interest in the rule of law is also important. The law applies to journalists and the press as it applies to everybody else. This is not to say that journalists cannot sometimes break the law in the pursuit of public interest journalism, but that does not override the general public interest in the rule of law: on the contrary, it recognises that a clear countervailing public interest must be identified before the rule of law may yield. Finally, there is a public interest in the protection of the private rights of individuals, including the right to privacy, which falls to be weighed in the balance against the public interest in free speech. Providing this requisite balance is one of the most difficult challenges for any regulatory regime. The Inquiry has heard evidence that different editors weigh up these countervailing public interests in different ways. That may not be unreasonable looking at individual cases alone, but from an enforcement perspective it is only fair for both the public and the press themselves that each relevant enforcement authority should be clear about the basis on which they will reach such judgments. It also seems reasonable that, if there is to be a body adjudicating on press or media standards, such a body should set out for the public and the industry some guidance on what might be meant by the public interest in this context. The PCC Code, as most recently revised, sets out the following non-exhaustive definition of the public interest: 6 7

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p1, lines 15-17, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-10-July-2012.pdf 5 Part J, Chapters 2 and 3 6 pp8-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-Roy-Greenslade-ofCity-University.pdf 7 PCC code, http://www.pcc.org.uk/cop/practice.html

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“The public interest There may be exceptions to the clauses marked * where they can be demonstrated to  be in the public interest. 1.  The public interest includes, but is not confined to:  (i) Detecting or exposing crime or serious impropriety. (ii) Protecting public health and safety. (iii) Preventing the public from being misled by an action or statement of an individual or organisation. 2.  There is a public interest in freedom of expression itself. 3.  Whenever the public interest is invoked, the PCC will require editors to demonstrate  fully that they reasonably believed that publication, or journalistic activity undertaken  with a view to publication, would be in the public interest and how, and with whom,  that was established at the time. 4.  The PCC will consider the extent to which material is already in the public domain,  or will become so. 5.  In  cases  involving  children  under  16,  editors  must  demonstrate  an  exceptional  public interest to over-ride the normally paramount interest of the child.” 2.6 There are a number of references to the public interest in the Ofcom Broadcasting Code.8 There is no definition of the public interest as such, but the code does provide this: “Examples of public interest would include revealing or detecting crime, protecting  public  health  or  safety,  exposing  misleading  claims  made  by  individuals  or  organisations or disclosing incompetence that affects the public.” 2.7 The BBC includes a definition of the public interest in its editorial guidelines:9 “The Public Interest Private  behaviour,  information,  correspondence  and  conversation  should  not  be  brought into the public domain unless there is a public interest that outweighs the  expectation of privacy.  There is no single definition of public interest.  It includes but  is not confined to:

• • • • • • •

exposing or detecting crime exposing significantly anti-social behaviour exposing corruption or injustice disclosing significant incompetence or negligence protecting people’s health and safety preventing people from being misled by some statement or action of an individual or organisation disclosing information that assists people to better comprehend or make decisions on matters of public importance.

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There is also a public interest in freedom of expression itself. 
Ofcom’s Broadcasting Code, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/08/Exhibit-OFCOM11.pdf BBC Editorial guidelines, http://www.bbc.co.uk/guidelines/editorialguidelines/page/guidelines-privacy-introduction

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When  considering  what  is  in  the  public  interest  we  also  need  to  take  account  of  information already in the public domain or about to become available to the public.  When using the public interest to justify an intrusion, consideration should be given  to proportionality; the greater the intrusion, the greater the public interest required  to justify it.” 2.8 Although these definitions, or examples, have a lot in common there are naturally some differences. Views have been advanced on each of them, but it is not for this Inquiry to draft a comprehensive working definition: this would be both an overly ambitious and inappropriate exercise. However, given that this is the public interest, and that it must explicitly relate to interests outside those of the media enterprise concerned, it must be reasonable to conclude that whatever interpretation of the public interest is to be used in a new regulatory regime, it should be recognised, understood and accepted by both the media and the public. Finally on the question of effectiveness, the criteria spoke of a durable solution, and one sufficiently flexible to work in the future. It is, of course, the case that, as many witnesses have told the Inquiry, the media market is changing. Rupert Murdoch predicted that the printed press might coexist with online news sources for possibly 20 years, but he also commented that others estimated that the print versions may not survive for more than five or ten years.10 Without needing to take a view on how long the printed press will survive, it is unquestionably the case that a large proportion of people now receive at least some of their news and current affairs content, and their entertainment, from the internet. Ofcom estimated that 41% of people today use the internet for news and current affairs coverage, and that the internet accounts for 21% of news and current affairs consumption; this compares with 53% of adults using a newspaper, but newspapers account for only 11% of news and current affairs consumption.11 Furthermore, the trend towards online consumption is rising. This makes it abundantly clear that, for a regulatory regime to be effective, it must be capable of delivering any perceived benefits to online publication as much as to print. The Inquiry has also received evidence that a single regulatory regime across all media would be desirable.12 The Inquiry has heard some evidence on the nature and effectiveness of the existing statutory regulatory framework for broadcast media; but this has been largely for the purposes of comparison with the regime currently in place for print and to learn any relevant lessons. I have not sought to take evidence on the adequacy of the regime for the broadcast sector and, accordingly, it is not my intention to examine the fitness of that regulatory regime, or to make any recommendations as to how the broadcast sector should be regulated. Ofcom correctly commented that the published draft criteria did not mention membership.13 The criteria aimed to set out what a new regulatory regime should achieve, not the means by which it should be achieved. The draft criteria provide that a new solution should be ‘capable of universal application’. My starting point, as set out above, is that any regime which did not at the very least cover all major national newspapers and their online presence, would not be

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2.10

2.11

p76, lines 17-20, Rupert Murdoch, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/04/Transcript-ofMorning-Hearing-26-April-2012.pdf 11 p16, para 4.5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom-MeasuringMedia-Plurality1.pdf 12 pp6-7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Sumission-from-Jeremy-Hunt-MP.pdf; p8, para 3.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Tim-Suter-of-PerspectiveAssociates.pdf 13 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Covering-Letter-from-Ofcom.pdf

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effective. The Inquiry has received submissions suggesting that standards regulation might be limited to those of a particular size or with particular economic power.14 Ofcom say:15 “Committed  participation  by  the  whole  of  industry  would  be  fundamental  to  a  successful new regulatory regime” It has been made abundantly clear in the proposals presented during Module Four of the Inquiry that the vast majority of interested parties agreed with that. All the proposals that have come to the table have sought to compel or entice the whole of industry into the tent. Any disagreement has been about whether compelling or enticing is the best way to achieve the objective of committed participation, coupled with what have been described as principled concerns about the use of legislation to compel any part of the press to do anything. I have no doubt that committed participation by the whole of industry is fundamental to an effective new regime. 2.12 My conclusion is that Criteria 1 as originally drafted continues to reflect the essential elements of a new effective regime.

3. Fairness and objectivity of standards
3.1 The draft Criteria set out three aspects of fairness and objectivity of standards which I considered were fitting attributes of a new regulatory regime. The first was that there should be a statement of ethical standards which is recognised as reasonable by the industry and as credible by the public. This statement must identify enforceable minimum standards as well as articulating the good practice that should be targeted. The Inquiry has not undertaken a full systematic examination of the existing Editors’ Code but it has identified some deficiencies that have been identified in evidence presented to the Inquiry.16 Many witnesses have maintained that it is a good Code; others have argued that it has weaknesses. In this context I simply note that the current Editors’ Code appears to be a mix of broad statements of principle (for example “the press, whilst free to be partisan,  must distinguish clearly between comment, conjecture and fact”); specific requirements (for example “even  where  the  law  does  not  prohibit  it,  journalists  must  not  use  for  their  own  profit financial information they receive in advance of its general publication to others, not  should  they  pass  such  information  to  others”); and requirements that can sometimes be disregarded (e.g. “the press must not identify victims of sexual  assault or publish material  likely to contribute to such identification unless there is adequate justification and they are  legally free to do so”). In addition, there are examples of each of these types of statement which can be disapplied where doing so can be demonstrated to be in the public interest. Professor Megone commented that a code of practice needs to be presented in the context of the specific critical contribution that a free press can make to the public interest. Overall, there is room for improvement of the current Code. 17 Second under this broad heading, the draft Criteria specified:

3.2

3.3
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p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/10/Further-submission-from-the-MediaStandards-Trust.pdf; p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-byCoordinating-Committee-for-Media-Reform.pdf 15 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Covering-Letter-from-Ofcom.pdf 16 Part J, Chapter 5 17 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/10/Further-Submission-from-ProfessorChristopher-Megone.pdf

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“All standards for good practice in journalism should be driven by the public interest  and must be benchmarked in a clear objective way to the public interest.” 3.4 Associated News Limited (ANL) have raised a concern about this, stating that the press should be free to publish material of their choice without always having to justify it on grounds of public interest. I accept entirely that the vast majority of material published in most newspapers and magazines will not infringe other peoples’ rights or the law and has no need to be justified on public interest, or any other, grounds. It was not the intention in these draft criteria to suggest that all material in a newspaper should be able to pass a public interest test. However, ANL also raised the issue of “information which might be thought to  constitute a low-level interference with personal privacy” and, in the same context, observed that standards of this sort “would  constrain  newspapers  from  providing  the  broad  mix  of  newspaper  that…….ensures  the  very  survival  of  the  industry.” 18 Here, the authorities do recognise that a minimum threshold of interference must be attained before the right itself may be said to be infringed. Exactly how this should be formulated would be for any future code-maker to consider. Subject to that, any infringement of the substantive right must be justified. Finally under this heading, the criteria specified that the setting of standards must be independent of Government and Parliament, and sufficiently independent of media interests in order to command public respect. In some ways this has sparked the most debate. Whilst there is universal agreement on the principle of the independent setting, there are also many proposals that would see Parliament laying down some basic criteria which such standards must attain. This is the case with, for example, the Irish Defamation Act, which has been cited by many as a successful example of how Government can incentivise independent regulation. There is also disagreement about what constitutes ‘sufficient’ independence of media interests. Lord Black on behalf of the industry proposed a system in which serving editors still had a majority on the committee which set the standards,19 whereas Ofcom, by contrast, considered it to be “unimaginable” to have anyone currently active within the industry as part of the standards setting body.20 It would therefore appear that, whilst everyone is willing to support the theory of independence, it is difficult to find any particular consensus on what independence looks like in practice. My conclusion is that Criteria 2 as drafted remains the right articulation of fairness and objectivity of standards, but with an explicit recognition that not all material published in newspapers would or should need to satisfy a public interest test as opposed to providing material which merely entertains or interests the public. The standards must, however, recognise that any infringement of individual rights should only be acceptable where there is a sufficient public interest rationale.

3.5

3.6

3.7

p18, para 40, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-Submission-from-AssociatedNewspapers-Ltd.pdf 19 p41, para 80, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 20 pp101-102, lines 7-9, Dr Colette Bowe and Ed Richards, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Transcript-of-Morning-Hearing-12-July-2012.pdf

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4. Independence and transparency of enforcement and compliance
4.1 The draft Criteria provided that enforcement of ethical standards must be operationally independent of Government and Parliament and sufficiently independent of media interests. This, by contrast with the setting of standards, has proved relatively uncontroversial. All the proposals put forward to the Inquiry included an independent approach to complaint handling, and most attempted to describe a broader independent standards enforcement role. There were, inevitably, different views on what constitutes independence, but at a level of principle this seems to be genuinely uncontentious. The draft Criteria also provided that all relevant appointments processes must be sufficiently independent of Government, Parliament and media interests. This raises the basic conundrum of who appoints the appointers. None of those who have provided evidence to the Inquiry have suggested that the appointments processes should not be sufficiently independent of the interests listed, but there are differences around what constitutes ‘sufficiently’, and at what level the independence needs to be demonstrated. By way of example, in the proposal from Tim Suter, the Ofcom Content Board would need to approve the independence of the appointment process for any self-regulator, whilst the Content Board21 itself is appointed by the Ofcom Board, which is appointed by Government.22 Lord Black’s proposal, on the other hand, would rely on an appointment committee composed half and half of industry appointees and lay members to appoint the Chair of a new regulator. I do not accept that an appointment procedure that allows an effective veto to the industry could be considered to be sufficiently independent. Similarly, it must be the case that in relation both to specific enforcement and overarching standards compliance the operation and decisions of the regulator are fully independent from those being regulated. Finally under this heading, the draft Criteria specified that compliance must be the responsibility of editors, and must be transparent and demonstrable to the public. One of the strong themes emerging from the proposals submitted to the Inquiry was the emphasis on the need for companies to take more responsibility internally for compliance and for dealing with complaints about standards. This is addressed in Lord Black’s proposal through the presumption that all complaints should be dealt with in the first instance by the company concerned, the requirement for a named senior executive to have responsibility for compliance and the requirement for each regulated entity to provide an annual compliance report. There may be some question as to whether it is specifically the editor, as opposed for instance to the managing editor, who should be responsible for compliance; but the Inquiry has seen nothing to suggest that the principle underlying this criteria has anything other than full support. My conclusion is that Criteria 3 as drafted remains an appropriate benchmark for independence.

4.2

4.3

4.4

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p2, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Tim-Suter-ofPerspective-Associates.pdf 22 p24, para 38, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf

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5. Powers and remedies
5.1 The draft Criteria indicated that an effective new regime must provide credible remedies, both in respect of individuals and of issues affecting wider groups in society. The concept of ‘credible remedies’ has been the subject of some debate. For many, the publication of an agreed correction or apology constitutes a credible remedy; for others it does not. The draft Criteria made no mention of sanctions, as opposed to remedies, but there have been representations suggesting that a new regulatory regime should include sanctions, including power to fine, as well as remedies in respect of particularly serious or systemic breaches.23 I freely accept the argument that sanctions are different in kind to remedies, in that the former aim to punish and deter breaches of standards, whilst the latter aim to provide solace for the individual affected. I further accept that an effective regulatory regime must have some form of sanction, at least for systemic or egregious breaches of standards. There is broad agreement that there must be a system of credible remedies for individuals who have been adversely affected by a breach of standards. However, there are widely differing views when it comes to the rights of third parties or groups of people to make complaints or have access to remedies. In relation to third parties, there is a clear, and reasonable, concern about the risk of such persons or groups making a complaint where the individual directly concerned either is not troubled by the article or, more realistically, would prefer to let the matter drop. Some have argued that the subject of an article should have a veto on the consideration of a complaint. Plainly, a number of issues arise here. If the system is based solely on remedies then there is little point in taking a complaint from anyone for whom the range of potential remedies would not be meaningful. Ofcom has argued that, if there has been a breach of regulatory standards, then the regulator should have the discretion to investigate regardless of whether the subject of the relevant article wishes to take the matter further. In this context the issue is one of industry standards, not abuse of personal rights; but this is pertinent only to the extent that the regulator can issue some kind of adjudication, guidance or sanction that will inform subsequent behaviour, as well as seeking to provide redress to an individual who has suffered harm. The British and Irish Ombudsman Association has pointed out that for practical reasons there needs to be some limitation on who can bring a complaint. This has been echoed by others, who fear that in allowing third party complaints, and in particular group complaints, the standards regime could be hijacked by groups wanting to fight political battles on the pretext of complaining about standards. In particular, ANL has argued:24 “This  would  potentially  subvert  the  purpose  of  the  regulatory  system,  which  is  to  protect the rights of those affected by the press and promote high standards. It is not  to provide a means by which special interest groups can seek to impose their views  on society at large by controlling what is written in the press about them and the  interests they represent.” 
p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Covering-Letter-from-Ofcom.pdf; p10, para 23, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-of-Brentwood1.pdf; p8, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf; p20, para 3.35, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1.pdf; p11, http:// www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-on-behalf-of-theNational-Union-of-Journalists.pdf; p13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submissionby-Coordinating-Committee-for-Media-Reform.pdf 24 p18, para 42, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-Submission-from-AssociatedNewspapers-Ltd.pdf p8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf
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5.2

5.3

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5.4

I am confident that, at some level, it must be possible within any effective new system for breaches of the relevant code to be drawn to the attention of the enforcement body by those affected by the breach, whether in the form of a direct personal reference or more indirectly. There is clearly room for debate as to precisely how this may be achieved and what sort of remedies or sanctions might be appropriate should a breach of standards be found. I do not believe that it is right to characterise the desire of groups to see agreed standards upheld as an attempt to “impose their views on society at large by controlling what is written in the press  about them”.25 If a title has agreed to conform to certain standards then it is a reasonable expectation that they should do so without any group who maintains that those standards are not being upheld being accused of trying to interfere with freedom of expression. The draft Criteria indicated that a new regime must have effective investigatory and advisory powers. Inevitably, there will be disagreement about what constitutes ‘effective’ in this context, but overall this has proved particularly uncontentious in principle, with most proposals including investigatory powers of some sort. The draft Criteria also proposed that any new system should actively support and promote compliance with standards. Again, at a level of generality this has not proved to be a contentious issue, although quite who would be responsible for taking a proactive approach to promoting compliance varies from model to model. In this context, the draft Criteria suggested a few examples of ways in which active support and promotion of standards might happen. One of these was kitemarking; the provision of a kitemark is widely seen as an important part of any voluntary self-regulatory scheme. Some have suggested that the commercial value of a kitemark would be limited, but others believe that the public would want to buy a product that advertised its commitment to standards. The draft Criteria also mentioned the example, under this rubric, of providing confidential pre-publication advice to editors. This has proved somewhat controversial, but it was not the intention of the Inquiry by including this feature in the draft criteria to advance any specific proposal. In the event, proposals have been submitted to the Inquiry under which some facet of a new regulatory system could offer confidential advice to editors, in advance of publication, on the merits of any public interest arguments that might later be relied on in actions relating to breach of privacy or breach of standards. Such advice would not be binding in any way, but the fact that advice had been sought (and either followed or ignored) could be taken into account in any subsequent enforcement action.26 Concerns have been advanced about such proposals on the grounds that any intervention prepublication is a fundamental breach of freedom of expression.27 For example, ANL contend that “for a regulator to involve itself in pre-publication decisions is to trespass on the editor’s  role”. 28 There are additional questions to be answered about who the appropriate body would be to provide such advice, the relationship between that body and the enforcement body. Notwithstanding the concerns which have been expressed, for reasons which will be elaborated subsequently it remains my view that the provision of pre-publication advice to editors, on request, would be a useful service for a regulatory body to provide.

5.5

5.6

5.7

5.8

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p19, para 42, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-Submission-from-AssociatedNewspapers-Ltd.pdf 26 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf; pp3-4, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Regulation-Round-Table.pdf 27 p43, para 14, Sir Charles Gray, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-12-July-2012.pdf 28 p19, para 43, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-Submission-from-AssociatedNewspapers-Ltd.pdf

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5.9

Finally under this heading, the draft Criteria indicated that the new regime would need to be a good fit with other relevant regulatory and law enforcement functions. This, as one might have expected, is completely uncontroversial at the level of principle, but may prove more difficult to implement in practice. There have been a number of concerns raised about the boundary between whatever new regime is proposed in this context and the existing broadcasting regulation. Some suggestions envisaged bringing together all media under a unitary approach to regulation, although no-one has gone as far as suggesting a single regulator for all media. Others have expressed concern about the jurisdictional difficulties of regulating online content, and yet others about the boundary with the statutory requirements on online TV-like services imposed by the Audio Visual Media Services Directive. I share these concerns and consider that it will be important that the coverage of any new regime is clearly articulated and avoids any overlap between media regulators.29 The Inquiry has heard little about the need for any new standards system to fit within an overall effective regime, including criminal and civil law enforcement, although that is obviously essential, indeed, some witnesses have suggested that effective criminal law enforcement would be a sufficient answer to the problems exposed by the Inquiry. I have set out earlier in the report why this is not, and never will be, a credible solution. I do not see any reason why, where standards and the criminal law overlap, there should not be an expectation that the regulator would continue to perform its core regulatory functions as it would in respect of any other standards.30 My conclusion is that Criteria 4 as drafted provides a satisfactory set of requirements in relation to powers and remedies, subject to the introduction of a further point that the regime should include appropriate and proportionate sanctions for systemic or egregious breaches of standards.

5.10

5.11

6. Cost
6.1 The draft Criteria stipulated that the solution must be sufficiently reliably financed to allow for reasonable operational independence and appropriate scope, without placing a disproportionate burden either on the industry, complainants or the taxpayer. As drafted, it is difficult for anyone to disagree with that proposition and no-one has sought to do so. However, it is very difficult at this point to predict what the cost of any of the various approaches that have been put forward to the Inquiry might be. Lord Black estimates that his proposal would cost in the region of £2.25m31 but many editors, in particular from the regional press and magazines, have expressed concerns about the robustness of this estimate and whether the industry will be able to afford the attendant costs.32 Other proposals have suggested that

http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Tim-Suter-of-PerspectiveAssociates.pdf; http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Sumission-from-Jeremy-Hunt-MP.pdf 30 Part J, chapter 2 31 p45, para 94, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/10/Fourth-Witness-Statement-of-LordBlack.pdf 32 p2, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-statement-of-Ian-Stewart1. pdf; p3, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-WS-of-Rosie-Nixon2.pdf; p2, para 6c, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Adrian-Faber-in-responseto-Module-4-Questions.pdf; p3, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submissionfrom-Peter-Charlton-Yorkshire-Post-Newspapers.pdf

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Government funding for part of a new regulatory regime might be reasonable, though it is worth noting that this is rejected by Lord Black as a matter of principle.33 6.2 Ofcom has argued that fixed term funding settlements are necessary to provide the level of operational independence that any regulatory body would need.34 Any funding approach which relied on year by year agreement of the regulator’s budget would allow too much potential for the funding body to influence the approach to compliance and enforcement taken by the body. A common theme running through these proposals is that it should be free for persons aggrieved to bring complaints. Obvious questions have been raised about the risk of frivolous or vexatious complaints but, making due allowance for the fact that mechanisms can be put in place to deal with those issues, essentially this is another area on which the Inquiry has seen consensus. My conclusion is that Criteria 5 as drafted is an appropriate measure, albeit recognising that ‘reliability’ of funding means multi-year settlements to protect the independence of the regulator from undue influence from those funding it.

6.3

6.4

7. Accountability
7.1 Ofcom suggested that a further criteria for the accountability of the new regime should be added. Specifically, they contended that there should be an independent review of whatever new regime is put in place after three years. Arguably, this is of particular relevance in the context of the history of press self-regulation which demonstrates that historically it has been difficult to secure any lasting effective change.35 I agree that an independent review of any new regulatory regime would be an important benchmark in testing effectiveness.

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pp70-71, lines 23-3, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 34 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Covering-Letter-from-Ofcom.pdf 35 Part D, Chapter 1

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ChapTer 2 The self regulaTory Model proposed by The pCC and pressbof
1. Industry acceptance of the need for reform
1.1 In the early days of the Inquiry I made it clear that I was keen that the press industry should come forward with a credible proposal for the future regulation of standards across the press. I said that it was critical that the press should engage in the debate about how its regulation should move forward,1 that this was a problem for the industry and that the industry had to solve it.2 I also explained that it was important that a solution should be found which worked both for the press and for the public and I looked to the press to come forward with proposals that would fit that brief; however, in the meantime I would continue looking for ways to improve the system.3 It is difficult to find an objective test for what ‘works for the public’. The public have three distinct roles here: first as readers of newspapers, second as citizens of a democratic country and third as the people about whom newspapers write. It is important that the interests of the public in all three roles are recognised and protected: the Prime Minister said that the test must be whether a solution works for the Dowlers and the McCanns.4 It has been common ground that PCC does not offer a credible form of self-regulation and that significant change is needed. The current PCC Chair, Lord Hunt agreed that “tinkering around  the edges” would not be sufficient and that this was an opportunity for the press to come forward with “the sort of system Sir David Calcutt was asking for.” 5 Lord Black, Chairman of the Press Standards Board of Finance (PressBoF), said he had never believed the PCC to be a regulator,6 and accepted that the PCC had failed:7 “The evidence submitted throughout the Inquiry into Press Standards has made clear  that the Press Complaints Commission ultimately failed. While it had some significant  achievements  to  its  name,  particularly  in  its  early  years,  it  proved  incapable  of  dealing with the major ethical and cultural issues that have arisen in recent times.  The scandal of phone hacking – and the PCC’s inadequate response to it – underlines  that point. As a result, the existing system lost the confidence of Parliament, of the  public  and  of  the  judiciary,  all  of  whose  support  is  essential  if  self  regulation  is  to  flourish. Crucially, the Commission also lost the support of parts of the newspaper and  magazine publishing industry. The industry accepts the need for wholesale change,  but within the framework of self regulation.”
1

1.2

pp66-67, lines 18-1, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-ofAfternoon-Hearing-31-January-2012.pdf 2 p36, lines 1-8, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-of-MorningHearing-1-February-2012.pdf 3 p36, lines 9-20, Lord Black, ibid 4 pp66-67, lines 13-2, David Cameron, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Transcript-ofAfternoon-Hearing-14-June-2012.pdf 5 p67, lines 1-12, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcript-of-AfternoonHearing-31-January-2012.pdf 6 p14, lines 13-14, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Transcript-of-MorningHearing-1-February-2012.pdf 7 p13, paras 1-2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf

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1.3

In recognition both of the failure of the current system of ‘self-regulation’ and the need for an industry generated proposal for the future, Lord Hunt developed a set of proposals which have been further developed by Lord Black, on behalf of the industry. A version of that proposal, representing the fruits of over 12 months work by the industry, has been submitted by Lord Black as “working documents in draft”.8 There has been a process of consultation with many parts of the industry, resulting in the following statement from the Newspaper Society, the Newspaper Publishers Association (NPA), the Scottish Daily Newspaper Society and the Professional Publishers Association: “While a lot of detailed work is still to be done, the proposals have the broad support  of the organisations and their members. The proposals are being further developed  in the light of comments received as part of the ongoing consultation process. This  process will take into account the deliberations and recommendations of the Leveson  Inquiry and the Government responses to its findings.”

1.4

It is important to recognise that publishers have not yet been asked to sign the contracts that underpin this proposal (so that at the time of publication of this report it remains open to doubt, if not considerable doubt, as to precisely what a final agreement might look like, or even whether such an agreement could be reached and which publishers would be willing to join). This Section of the Report looks at the proposal as it was submitted to the Inquiry.

2. The proposal: overview
2.1 The proposal is based on a voluntary model described by Lord Black as “independently led  self-regulation”. The key features are: (a) the creation of a new self-regulatory body, under an independent Trust Board, with greater independence from the industry than the PCC currently has and the power to impose fines for particularly serious or systemic failures; a contractual relationship between the regulated body and each of the publishers to provide for medium term commitment to the system; a continuation of the complaints handling role of the PCC; the creation of a separate arm of the regulator with powers to investigate serious or systemic failures; and the establishment of a new industry funding body to provide financial stability for the regulatory body.

(b) (c) (d) (e) 2.2

The proposal is set out in full in Lord Black’s submission,9 together with a draft contractual framework,10 draft Articles of Association of the new Regulator11 and draft Regulations12 that the members (or ‘regulated entities’) would have to comply with. Here I describe the key relevant features of the proposal in order to consider the extent to which it is capable of delivering the objectives set out earlier.13 They will be analysed later in the Report.14

8

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p2, para 3, ibid http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-of-Brentwood1.pdf 10 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1.pdf 11 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-D1.pdf 12 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1.pdf 13 Part K, Chapter 1 14 Part K, Chapter 4
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3. Governance and structures
3.1 Figure K2.1 below provides a pictorial representation of the composition of the various bodies and how they relate to each other. The regulatory body itself is comprised of the Trust Board, which has overall responsibility for the self-regulatory regime, with subcommittees dealing with complaints and compliance and investigations respectively. Sitting outside the self-regulatory body are the Industry Funding Body (IFB), which is responsible for setting and delivering the funding for the regulatory body, and the Code Committee, which is responsible for agreeing the Code with which all regulated entities will have to comply.

The Independent Press Trust
3.2 The Independent Press Trust will be established as a Community Interest Company.15 The draft Articles of Association set out the objects of the Trust:16 “The objects of the Company are to carry on activities which benefit the community  and  in  particular  to  promote  and  uphold  the  highest  professional  standards  of  journalism in the United Kingdom, the Channel Islands and the Isle of Man, including  by:

• • • • • •

Establishing the Regulatory Scheme for regulating Regulated Entities; Promoting compliance with the Editors’ Code of Practice; Encouraging conciliation between Regulated Entities and complainants; Investigating and adjudicating on complaints from the public about Regulated Entities; Publishing its findings; and In accordance with the Regulatory Scheme, levying fines on Regulated Entities found to be in significant, systemic breach of the Editors’ Code of Practice, such fines to be proportionate to the nature and effect of the breach;

having regard at all times to the importance in a democratic society of freedom of  expression and the public’s right to know.” 3.3 The principle decision making body of the Trust would be the Trust Board17 with a Complaints Committee which would have primary responsibility for dealing with public complaints and an Investigations and Compliance Panel.18 Operationally the Trust would be run by a Chief Executive Officer (CEO), who would be appointed by the Board and report to them. There would also be a Head of Complaints, supporting the Complaints Committee, and a Head of Standards and Compliance, supporting the Compliance and Investigation Panel, who would each report to the CEO and ultimately to the Board.19, 20

p21, para 30, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 16 pp4-5, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-D1. pdf 17 paras 3.9-3.14 below 18 p7, para 15, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 19 p2, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1.pdf 20 see Figure 1

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Trust Board Ceo

Complaints Committee Head of Complaints

Compliance and Investigation Panel Head of Investigations and Standards

Figure K2.1: Structure of the Independent Trust 3.4 The Trust will be able to cover companies in the UK, the Channel Islands and the Isle of Man who are responsible for publishing printed newspaper or magazine titles in the UK, and their related websites, and web only publisher or news aggregators with content viewable in the UK.21 Membership will not necessarily be open to any company meeting those criteria. The Industry Funding Body would have:22 “ultimate  discretion  to  refuse  membership  to  any  publishers  wishing  to  join  the  scheme, even if such a publisher falls within the definition of a regulated entity.” 3.5 In his oral evidence Lord Black explained that this provision was in order to allow membership of the Trust to be refused to what he described as “top shelf publications” whose membership would be “wholly inappropriate” as the only complaints in relation to them were likely to be about taste and decency.23 As drafted, this provision does not appear to place any restrictions on who could be refused membership by the IFB, or on the reasons for such a refusal. Neither does it allow the Press Trust itself any say in whether membership should be granted to an applicant. This could be an issue of particular concern if there were significant benefits to membership, or disadvantages attaching to non-membership. In terms of content, the remit of the Trust covers editorial content in printed newspapers and magazines (but not books) and on websites and apps.24 The Trust would not cover broadcast content, advertising, taste and decency, impartiality, copyright issues or employment

3.6

3.7

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p22, para 31, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 22 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1.pdf 23 pp106-107, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 24 p1, para 1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1.pdf

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issues. In addition, the Trust will not cover issues in relation to current or possible criminal proceedings. The Trust will not cover non editorial content in newspapers or magazines, or content over which the publisher has not exercised editorial control.25 3.8 The functions of the Trust are to deal with complaints and mediation and to deal with standards and compliance.26 These are dealt with in more detail below.27 The Trust Board 3.9 It is proposed that the Trust Board will guarantee the independence of the new system. It will be responsible for the management of the company’s business, specifically supervising the governance of the company, managing its finances and audit, being responsible for the appointment of independent members, and liaising as necessary with the industry’s trade associations.28 The Trust Board has no role in the investigation of individual complaints from members of the public. By contrast, the Trust Board has to trigger any investigation into serious or systemic breach. The Trust Board is also responsible for establishing any appeal panel in relation to an investigation and for exercising the power of sanction in response to an investigation where that is appropriate.29 The ‘Regulator’, or in practice the Trust Board, will have responsibility for any changes to the Regulations, although any such changes must be approved by the IFB before they are made.30 The Trust will not be responsible for the Editors’ Code of Practice31 but any changes to the Code will have to be ratified by the Trust Board before they come into effect.32 The Trust Board: membership and appointments  3.12 The Trust Board is to comprise seven directors, four of whom (including the Chair) are to be independent, and three of whom are to be press directors.33 Members will serve a three year term, renewable once.34 No Trust Board member has more than one vote. The Chair has a second and casting vote in the case of a tied vote.35 The appointment of the Chair would be by a four person panel comprised of two industry members, appointed by the IFB, and two lay members, entirely independent of both the industry and the Trust and appointed by the Trust Board.36 The panel would appoint a search consultant to draw up a shortlist for the post of the Chair. The panel would then interview the shortlisted candidates and make the appointment by unanimity.37

3.10 3.11

3.13

p1, para 3, ibid p4, para 4, ibid 27 Part K, Chapter 2, sections 4 and 5 28 pp23-24, para 37, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 29 pp23-24, para 37, ibid 30 p4, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1.pdf 31 part K, chapter 2, section 8 32 p4, para 37, ibid 33 p23, para 38, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 34 p23, para 38, ibid 35 p7, para 15, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-D1. pdf 36 see para 3.14 for an explanation of the appointments process for the first Board 37 pp40-41, para 76, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf
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3.14

The three other independent members of the Trust Board are to be appointed through an independent appointments process determined by the Trust Board itself.38 A ‘shadow’ Trust Board will be set up by Lord Hunt to manage the first appointments process. Once the first permanent appointments have been made the Shadow Board will be disbanded.39 The submission does not say whether the panel to appoint the first Chairman will be appointed by the Shadow Board or the first permanent Board appointees. The three press members of the Trust Board will be appointed by the IFB and are expected to be individuals with senior editorial or publishing experience but not currently serving editors.40 Relationship between the Trust and publishers ‘regulated entities’

3.15

Publishers who join the Trust will be required to enter into a contract with the Trust which will require the publisher to:41 (a) (b) (c) (d) (e) comply with the Editors’ Code; comply with the Regulations; cooperate with any standards investigation; abide by the Trust’s decisions; and commit to funding for the period of the contract.

3.16

The Regulations set out the remit and functions of the Trust, the procedures for handling and mediation of complaints, the procedures for any investigations, the powers of the Investigations and Compliance Panel, the powers of the Board to impose sanctions, including fines, and the detail of the annual certification process.42 All this is, therefore, contained within the contractual framework. The Regulations are the responsibility of the Trust, but can only be amended with the approval of the IFB.43 The contract will also set out the obligations of the Trust to deal fairly and proportionately with the contracting parties.44 The original contract will be for a minimum of five years from the inception of the system45 and then continue on an annual rolling basis.46 Contracts will be between the publisher and the Trust and all contracts will be identical.47 The Trust has the right, as one of its powers of sanction, to terminate the contract with an individual publisher.48 An individual regulated entity has no power to terminate the contract.49 If a majority of contracting parties agree to terminate the contract then all contracts can be terminated on 12 months notice, although not before the expiry of the original five year term.50 The contracts can be varied by a majority of contracting parties, and where that is agreed the other contracting parties will be bound by the change.51 If a contract is terminated, the contracting party is still liable in respect of

3.17

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p24, para 38, ibid p25, para 39, ibid 40 p24, para 38, ibid 41 p34, para 61, ibid 42 paras 5.3-5.5 43 p4, para 6.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1.pdf 44 p34, para 62, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 45 p34, para 63, ibid 46 p1, para 2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1.pdf 47 p1, para 1.2, ibid 48 p5, para 10.3, ibid 49 p4, para 10.1, ibid 50 p5, para 10.4, ibid 51 p4, para 7, ibid
39

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the time during which they were party to the contract.52 If a title is transferred then the regulated entity has an obligation to use all reasonable endeavours to ensure that the new owner enters into a contract with the Trust.53 3.18 A ‘majority’ for the purposes of contract variation and termination is yet to be defined.54 Lord Black explained that this would not be a simple majority of members, as that would mean the magazine sector would have the ability to outvote the rest of the members. Instead there would need to be a system of weighted votes that would give no sub sector the power of veto over changes and that would reflect the nature and diversity of the market.55 The regulated entities have no contractual liability towards each other.56 The Regulator has no liability for failure to exercise its powers and functions,57 and third parties have no rights under the contract,58 so victims of press abuse and those complaining about press behaviour have no enforceable rights under this system. It has been suggested that the Trust could be subject to judicial review and Lord Black said that the industry would be unlikely to contest the justiciability of the body if an action for judicial review were brought.59

3.19

4. Complaints
4.1 There would be a Complaints Committee composed of 13 members: the Chair of the Trust, seven independent members, and five serving editors (two nationals, one Scottish, one regional and one magazine). The independent members would be appointed by the Trust. The industry members are to be nominated by their trade associations.60 As with members of the Trust Board, members of the Complaints Committee would serve for a three year term, renewable once. 61 Lord Black describes the proposed complaints handling regime as “building  on  the  widely  regarded  conciliation  techniques  of  the  PCC”.62 In a departure from current practice it is proposed that wherever possible a complaint should be handled directly by the editor of the publication concerned, and that only where a complaint cannot be resolved bilaterally should it become a matter for the regulator.63 Lord Black recognises that this would require the strengthening of internal compliance systems within publishers and argues that the new regulatory structure, including the annual compliance reports,64 would support this.65

4.2

p5, para 11, ibid p3, para 3.1.8, ibid 54 pp33-34, para 63, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 55 p116, lines 13-22, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 56 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1.pdf 57 p4, para 8.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1.pdf 58 p5, para 15. ibid 59 pp117-118, lines 23-8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 60 p27, para 46, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 61 p28, para 47, ibid 62 p26, para 42, ibid 63 pp25-26, paras 40-41, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Blackof-Brentwood1.pdf 64 paras 5.3-5.5 65 p25, para 40, ibid
53

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4.3

The Trust will consider complaints about the failure of a regulated entity to meet the standards set out in the Editors’ Code. Complaints will be accepted from people who have been directly affected by the matters complained of. In addition, the Head of Complaints will have discretion to consider third party complaints where there has been a significant breach and there is substantial public interest in allowing the complaint to be brought.66 In his oral evidence Lord Black said that third party complaints on accuracy were currently accepted by the PCC, that that practice would continue under the proposed model and that the draft regulations were not intended to restrict that practice.67 A complaint must be made within two months of the date of first publication of the article complained of, or within two months of the end of correspondence between the complainant and the publisher, as long as that correspondence was started straight after publication.68 Where the disputed article is published online and remains online at the time of the complaint, the Head of Complaints may consider the complaint if the company declines to remove the article.69 The proposed process appears to mirror closely the existing PCC approach. Once a complaint has been accepted by the Head of Complaints, the Trust will write to the regulated entity with a copy of the complaint. The company must then respond and a copy of that response is sent to the complainant. Any response from the complainant then goes back to the company. If the complaint has not been resolved by that stage then the primary aim of the Trust is to find a mediated resolution. If mediation is successful then a summary of the outcome would be published on the Trust’s website. If mediation is not successful the complaint is passed to the Complaints Committee.70 The Complaints Committee must decide whether or not there has been a breach of the Code. If the Code has not been breached then the Committee will reject the complaint. If the Code has been breached then the Committee must take a view on whether sufficient remedial action has already been taken. If the Committee considers that the breach has been remedied then the Head of Complaints must decide whether it is appropriate for details of the outcome to be published on the Trust’s website, but no other action is taken. If the breach has not been remedied then the Committee will make a public ruling upholding the complaint. The company will be obliged to publish the critical ruling with due prominence.71 Due prominence is to be interpreted in line with the Code.72 The current PCC practice under the existing Code is that the prominence of publication of critical adjudications to be agreed between the PCC and the publisher. Lord Black explained that it would be for the Trust to negotiate any changes to the Code in this respect with the Code Committee.73 The proposal itself does not give the Trust any powers to insist on the location or prominence of the publication of an adjudication.

4.4

4.5

4.6

4.7

K

p2, para 8-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1. pdf 67 pp11-16, lines 10-16, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-AfternoonHearing-9-July-2012.pdf 68 p2, para 10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1. pdf 69 p2, para 11, ibid 70 p3, para 15, ibid 71 pp3-4, para 16, ibid 72 pp26-27, para 43, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 73 pp17-18, lines 17-25 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-AfternoonHearing-9-July-2012.pdf

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4.8

The sanctions available to the Trust in relation to complaints may include informal resolution, published apologies, a formal reprimand and critical adjudication.74 The Trust will have no power to award compensation to a complainant.75 Neither will the Complaints Committee have any power to levy a fine. In the case of a particularly significant breach of the Code, the Trust may instigate an investigation which would then bring other sanctions into play. The complainant will have the right, within 14 days of the original decision, to appeal the decision to an Independent Assessor. The Independent Assessor will have the power to confirm the decision of the Complaints Committee or refer it back to the Committee with a different decision.76 The publisher has no right of appeal against a decision of the Complaints Committee.77 The Independent Assessor will be appointed by the Trust Board for a three year term, renewable once. The Assessor must not be a member of the Complaints Committee and must not be connected with the industry.78

4.9

4.10

5. Standards and compliance
5.1 As explained above,79 there will be a Head of Standards and Compliance, and it is proposed that there will be a small number of full time staff within the Trust who would service the Investigation and Compliance Panel. The Compliance Panel, however, would not be a permanent body but would be created on an ad hoc basis when required.80 Despite this ad hoc existence, the Panel would have a number of ongoing core functions assigned to it according to Lord Black’s submission. These would include:81 (a) “overseeing the process of annual certification by publishers about ethical and governance issues among their titles; (b) monitoring and analysing the responses to that process and taking up issues that arise from them; (c) monitoring trends in individual complaints dealt with by the Complaints Committee to detect issues of concern on individual titles or across individual publishers; and (d) analysing public or Parliamentary reports about press standards within specific areas to see if there is a substantive compliance issue highlighted by the that requires investigation.” 5.2 In each of these areas the Panel is expected to make recommendations to the Trust Board if they feel that an investigation should be undertaken.82 If the Board agrees that an investigation

pp26-27, para 43, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 75 p27, para 44, ibid 76 pp42-43, para 85, ibid 77 p20, lines 5-15, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-Afternoon-Hearing-9July-2012.pdf 78 pp42-43, para 85, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 79 para 3.3 80 pp53-54, lines 11-6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-AfternoonHearing-9-July-2012.pdf 81 p29, para 50, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 82 p29, para 51, ibid

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is appropriate they will then appoint an Investigation Panel from within a pool of experts, drawing on appropriate experience and expertise.83 There is an obvious scheduling difficulty here, since the recommendation that an investigation be carried out has to be made by the Panel, but a Panel is not appointed until the Board has authorised an investigation. In practice it is likely that the core functions described above would sit with the Head of Investigation and Compliance and its small staff. It is not entirely clear whether this executive team would be overseen on an ongoing basis by a public member of the independent Trust Board, appointed by the Trust Board.84 85

Annual certification and compliance
5.3 Each regulated entity will have to submit an annual statement of its editorial practices covering the following information:86 (a) (b) (c) concise factual information about the publisher, including the titles published and their circulation, and the name of the publisher’s compliance officer; copies of relevant manuals, codes or guidance; brief details on compliance processes, including how the publisher deals with prepublication advice, verification of stories, compliance with the Editors’ Code, editorial complaints and the training of staff; details of any incidents during the year involving a material breach of the Editors’ Code or the Regulations, and the measures taken in relation to such breaches; and details of the steps taken in response to any adverse adjudications by the Trust during the year.

(d) (e)

The requirement to compile and submit this annual statement is set out specifically in the draft contract framework, together with requirements on the regulated entities to use their best endeavour to ensure full cooperation with, and disclosure to, the Trust.87 5.4 The matter of whether these annual statements would be made public is left open. Lord Black told the Inquiry that the assumption was that the document would be published, with only commercial or personal confidential information redacted.88 The draft Regulations leave publication of the annual reports to the discretion of the Trust.89 When the Trust receives the annual reports they would be reviewed by the Head of Standards and Compliance, who would raise any concerns directly with the company involved, before putting a report to the Trust which would identify any issues of concern or that require further investigation.90

5.5

K

pp53-54, lines 11-6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-AfternoonHearing-9-July-2012.pdf 84 para 5.1 85 p26, para 49, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 86 p11, para 1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1. pdf 87 pp2-3, para 3.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-BrentwoodAnnex-B1.pdf 88 p60, lines 10-17, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-Morning-Hearing-9July-2012.pdf 89 p5, para 23, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1. pdf 90 p5, para 24, ibid

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Requirement for a named compliance officer
5.6 The draft contractual framework requires the appointment within each regulated entity of a senior individual who will take responsibility for ensuring that the regulated entity, and all its staff and subcontractors, comply with the contract.91 Lord Black describes this role as having responsibility for overseeing monitoring and compliance.92

Investigations
5.7 Both the structural aspects of the standards and investigations arm of the proposed Trust and the proactive compliance requirements placed on regulated entities are set out above.93 The Trust also has its own proactive powers of investigation, over and above specific reactive response to complaints, where there is cause for concern. An investigation by the Trust may be triggered in the following circumstances:94 (a) (b) (c) “where it appears there have been significant systemic breaches of the Editors’ Code or in general of ethical behaviour; where serious breaches of the criminal law have been found by the courts; or where annual certification identifies significant and substantive issues of concern in relation to a single incident, compliance processes or a long term pattern of code breaches.”

This list of circumstances in which an investigation may take place is not exhaustive.

Investigation process
5.8 Where it appears to the Investigation and Compliance Panel (the structural difficulties in this are noted above)95 that there is a need for an investigation into a particular publisher for one of the reasons above, they would make a report to the Trust Board, together with a recommendation for an investigation.96 The Trust Board can instigate an investigation in response to a recommendation from the head of Standards and Compliance or on its own initiative.97 If the Board believes that a full investigation is required, it would decide the remit and terms of reference for an investigation. It would then write to the proposed subject of the investigation, setting out the remit and terms of reference, and explaining why an investigation was thought necessary. The Trust Board will then take any response from the regulated entity into account in reaching its decision on whether to instigate an investigation.98 Once the Trust Board has decided that an investigation should take place they appoint a member of the Trust Board to have “day  to  day  oversight” of the investigation, which is

5.9

5.10

p3, para 3.1.7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1. pdf 92 p32, para 57, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 93 para 5.1-5.2 and paras 5.3-5.6 respectively 94 pp29-30, para 51, ibid 95 para 5.2 96 p29, para 51, ibid 97 p5, para 26, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1. pdf 98 pp6-7, para 27-28, ibid

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undertaken by the Head of Standards and Compliance.99 At the same time, the Trust Board must appoint an Investigation Panel. The Panel will comprise three people, two of whom will be public representatives with no connection to the press; and the third an individual with a senior newspaper or digital background, but not a serving editor.100 The Panel are all to be appointed from a pool of people with relevant expertise whose names will be published.101 5.11 The investigation would be carried out by the Head of Standards and Compliance, who must ensure that the investigation is independent, proportionate, fair, objective, open-minded and consistent.102 In pursing the investigation the Head of Standards and Compliance can request documents, answers to questions and access to key personnel. If the subject of the investigation refuses to provide the information required then the fact of the refusal, and the reasons for it, will be notified to the Investigation Panel.103 The Panel, however, have no role in resolving the situation. If there is any dispute between the Head of Standards and Compliance and the subject of an investigation about the scope of an investigation, that dispute would be referred to the Trust Board. If the subject of the investigation continues to refuse to provide documents that the Head of Standards has properly requested then the Trust can take legal action under the contract for specific performance. A decision to bring legal proceedings to compel production of documents has to be approved by the Trust Board. There is no equivalent power to seek specific performance in relation to access to personnel.104 Once the Head of Standards and Compliance has completed his investigation he would prepare a report detailing the conclusions and any recommendations. That report would be provided to the subject of the investigation, who then would have 28 days to provide written submissions to the Investigation Panel. The Investigation Panel would meet to consider the report from the Head of Standards and Compliance, together with any representations received from the subjects of the investigation. At that meeting the Investigation Panel would “in most cases” hear a presentation on the report from the Head of Standards and Compliance. It is not clear in what circumstances a presentation from the Head of Standards and Compliance would not be appropriate. In all cases the Panel will invite representatives from the subject of the investigation to attend the meeting, where they will be entitled to make representations and they could be asked questions by the Panel. The representatives of the subject of the investigation would leave the meeting when the Panel discusses and reaches its decision.105 At the meeting the Panel can request further work to be done, or it can reach a preliminary conclusion. The conclusions open to the Panel are:106 (a) (b)
99 100

5.12

5.13

5.14

5.15

that there is no evidence of any, or of significant, wrongdoing; to make non-binding recommendations about best practice, whether directed

K

p7, para 29, ibid p30, para 52, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 101 pp53-54, lines 24-6, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 102 p6, para 29, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1. pdf 103 p6, para 31, ibid 104 p6-7, paras 32-33, ibid 105 p7, paras 35-36, ibid 106 pp7-8, para 38, ibid

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specifically at the subject of the investigation or at the industry more generally; (c) (d) (e) to reprimand the subject of the investigation; to refer a systemic failure to the Trust Board to consider a fine; to direct the publication, by the subject of the investigation, of a summary of the Panel’s finding. The wording and prominence of that publication are to be agreed between the regulated entity and the Trust Board; to refer the matter to the Trust Board to consider a cost contribution; or to require undertakings from the subject of the investigation in respect of future conduct.

(f) (g)

Further consideration of these sanctions is made below.107 5.16 The decision of the Panel must be sent in draft to the subject of the investigation, who has 14 days to make comments on the draft, including correcting mistakes or arguing that anything has been misunderstood or that incorrect conclusions have been reached. Having received those representations the Panel will then reach a final decision.108 The subject of the investigation can ask for a review of that decision by writing to the Trust Board within 14 days of receiving the decision of the Panel. A review can be sought on the grounds that either the process or the decision were fundamentally flawed.109 The Trust Board will consider the evidence, including any new evidence submitted to it, and decide whether to accept the review request. If the Trust Board accepts the review request then they will establish a Review Panel.110 The composition of a Review Panel is exactly the same as that of an Investigation Panel but must not contain any of the members of the original investigations panel.111 The Review Panel would consider all the information provided to the Investigation Panel and, at their discretion, any new evidence provided. The draft decision of the Review Panel would be sent to the subject of the investigation who will have 14 days to make representations including, as at the earlier stage, to correct any mistakes, argue that anything has been misunderstood or that the wrong conclusions have been reached.112 The Review Panel would consider any representations made by the subject of the investigation and then reach a final conclusion, against which there is no further right of appeal.113 There is no role in this process for anyone who has been the victim of any of the behaviour under investigation. Complainants have no power to submit evidence or to provide submissions on the decisions.114 Complainants will generally not be aware of an investigation until a final decision is published. The decision of the Investigation Panel, or, if there is a review, the decision of the Review Panel, and the reasons for it, would normally be published.115

5.17

5.18

5.19

5.20

107 108

paras 5.21-5.25 below p8, para 40-41 ibid 109 p8, para 44-46, ibid 110 p8, paras 47-49, ibid 111 p9, paras 54-55, ibid 112 p9, para 52, ibid 113 p9, para 52-53, ibid 114 p7, para 34, ibid 115 pp8-9, paras 42 & 53, ibid

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Sanctions
5.21 The range of sanctions available to the Trust starts with a ‘reprimand’ about which no further information is provided. It is not clear how a reprimand would be issued, or whether it would be published, although publication of a summary of the Panel’s findings is also an available sanction. The Trust can also require, and monitor, undertakings in respect of future conduct. If the Investigation Panel (or the Review Panel) concludes that there has been a systemic failure the Trust Board has the power to levy fine on the relevant regulated entity.116 A ‘systemic failure’ is one: 117 “where  it  appears  there  has  been  one  or  more  significant  or  serial  or  widespread  breach  or  breaches  of  the  Editors’  Code  or  of  ethical  standards  which  indicate  a  systemic or serious failure at one or more Regulated Entity”. 5.23 The Trust Board would decide the level of the fine. The criteria to be followed by the Trust Board in determining the level of fines is to be set out in the Financial Sanctions Guidelines. The Financial Sanctions Guidelines are to be issued by the IFB.118 A draft of those guidelines has been provided and would allow the Trust Board to impose a fine of up to 1% of the turnover related to the publication found to have committed a systematic failure up to a maximum of £1,000,000.119 In setting the level of any fine the Trust Board has to take account of the following factors:120 (a) (b) (c) (d) the nature of the regulated entity; the nature of the systemic failure and its impact; whether the systemic failure was inadvertent or deliberate or reckless; any aggravating or mitigating factors (including whether the regulated entity brought the failure to the attention of the Trust, cooperation with the investigation, whether the management were aware of the failure and what steps, if any, they took to prevent it, and the previous record of the publisher); any adjustments for deterrence; and any discounts for early settlement.

5.22

5.24

(e) (f) 5.25

Finally, it is open to the Trust Board to require the regulated entity to make a contribution to costs. The Regulations indicate that there will be separate guidance on how the Trust Board should determine a cost contribution, but this is not covered in the material provided to the Inquiry.121

6. Potential for growth
6.1 The proposal allows for the addition of an arbitral arm to deal with matters of libel and/ or privacy issues. Lord Black states that a proposal along these lines has not been included in the submission to the Inquiry because the nature of any such arbitral system would be dependent on changes to the law, including the Defamation Bill currently before Parliament.

116 117

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p12, para 2.1, ibid p5, para 25.1, ibid 118 p3, para 5.1.4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-BrentwoodAnnex-B1.pdf 119 p12, para 2.1-2.2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-BrentwoodAnnex-C1.pdf 120 pp13-14, para 2.3-2.4, ibid 121 p8, para 38.6, ibid

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The Inquiry is told that the industry is keen to pursue this option and is satisfied that the proposal submitted is sufficiently flexible to allow for such a development.122

7. Funding
7.1 The proposed system would be fully funded by the industry through the payment of membership fees to the Trust. The funding arrangements for the standards and compliance part of the structure are slightly different, and are explained below, but again the process is fully funded by the industry. Lord Black, on behalf of the industry, has said that it would be inappropriate for the taxpayer to make any contribution towards a system of self-regulation. Similarly, it would be wrong to require complainants to pay any charge in relation to complaints. The fully funded self-regulatory proposal is submitted to the Inquiry as a sign of the industry’s commitment to protecting the public and putting right things which have gone wrong.123 124 The funding for the Trust will be guaranteed as part of the contract. Publishers will commit to making payments for the duration of the contract.125 The core cost (excluding compliance and standards work to be funded separately) is estimated to be around £2.25 million per annum.126 The fees payable by each publisher will be calculated according to an “agreed formula”.127 That formula is to be set by the IFB and can be changed at their discretion.128 Lord Black has told the Inquiry that it is:129 “impossible  to  predict  how  [the  costs  of  the  new  system]  might  be  fairly  and  proportionately divided within the industry.” 7.3 At a subsectoral level, the shares of the cost of the PCC are generally 54% for national newspapers, 39% for Scottish and regional newspapers, and 7% for magazines. These proportions have changed for the 2012 financial year, with national newspapers taking a 59.1% share, Scottish and regional newspapers a 34.4% share and magazines a 6.5% share.130 The current distribution of costs for the PCC between national newspapers has never been disclosed on a publisher by publisher basis as they are considered to contain commercially confidential information.131 The Inquiry has been told that the national newspaper publishers are currently looking at the funding formulae to see how they could better reflect the realities of new business models.132 Lord Black expressed the hope that whatever funding formula emerges from this process it might be possible to be more transparent about precisely who was paying what.133

7.2

122

p23, para 36, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 123 para 7.6 below 124 p12, para 26, ibid 125 pp43-44, para 89, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 126 p45, para 94, ibid 127 pp43-44, para 89, ibid 128 p4, para 9.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1. pdf 129 p8, para 28, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/10/Fourth-Witness-Statement-of-LordBlack.pdf 130 p2, para 6, ibid 131 pp2-3, para 7, ibid 132 p8, para 29, ibid 133 p92, lines 13-21, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf

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7.4 7.5

The IFB will publish the list of publishers who have signed a contract with the regulator and an annual record of the proportions of funding met by different parts of the industry.134 The IFB has the responsibility both to set the formula and to collect the membership fees from the publishers. There is no mechanism set down for the IFB to agree the overall level of funding with the Trust Board. Lord Black explained that the core costs are expected to be reasonably predictable at £2.25m,135 that these were significant sums for the industry in the current commercial climate,136 but that he had no doubt that sufficient funding would be made available to allow the regulator to fulfil its function.137 The standards and compliance costs are more difficult to predict and consequently will be subject to a different funding approach.138 The Trust will be established with a ring-fenced enforcement fund of £100,000 to cover the costs of the Investigations and Compliance Panel. It is anticipated that, over time, the costs of the compliance arm will be met from fines levied on publishers found responsible for wrong doing. Once the enforcement fund reaches £500,000 the original £100,000 contribution will be repaid to its initial contributors.139

7.6

8. The Code and the Code Committee
8.1 The whole proposal relies on the existence of the Editors’ Code as the statement of standards to which publishers commit when entering into a contract with the Trust. The Editors’ Code is currently owned by the Code Committee, which is comprised of 13 serving editors, drawn from across the industry.140 Under the proposal, that structure would remain in place, but there would be five additional members: the Chair and the Chief Executive of the Trust, and three further public members appointed by the Trust Board. The Chair of the Code Committee would be elected by the members of the Committee from among the editorial members.141 Under the draft contractual structure the Code is the responsibility of the IFB, although the relationship between the Code Committee and the IFB is not spelled out in detail. Any changes to the Code would need to be approved by the Trust Board before they could come into effect.142

8.2

9. The Industry Funding Body
9.1 The model presented is one of “independently  led  self-regulation”.143 The industry is represented in the system largely by the IFB, which has various roles and responsibilities.

134

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p44, para 90, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 135 p74, lines 1-5, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 136 p45, para 94, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 137 p73, lines 2-9, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 138 p74, lines 6-11, ibid 139 p45, para 93, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 140 pp40-41, para 79, ibid 141 pp40-41, para 79-80, ibid 142 p4, para 6.2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1. pdf 143 p45, line 19, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf

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Each of those roles have already been touched on in the paragraphs above, but this section sets out the totality of the IFB’s role in relation to the proposed self-regulatory regime. 9.2 Lord Black said:144 “In  any  self-regulator  regime  there  will  always  be  a  need  for  the  industry  to  be  involved  in  some  way.  In  this  case,  the  publishing  industry’s  chief  involvement  will  be  through  the  operation  of  the  Code  Committee  [….]  and  some  form  of  industry  co-ordination body to be responsible for funding. This is currently provided through  the Press Standards Board of Finance. Its structure and role may change so for the  purposed of this note this entity is referred to as the Industry Funding Body.” 9.3 The IFB is obviously responsible for setting and collecting the membership fees. The IFB would set both the overall level of funding to be provided to the Trust and the distribution of that funding between the regulated entities.145 The IFB has the power to enforce the contract between a publisher and the Trust in respect of the payment of the membership fee.146 The IFB is responsible for the Editors’ Code. Any changes to the Code will have to be approved by the Trust Board.147 The IFB is responsible for appointing the two industry members of the appointment panel that appoints the Chair of the Trust.148 The IFB must approve any changes to the Regulations.149 The IFB is responsible for the Sanctions Guidance which will be used in setting the level of any fine as a result of an investigation.150

9.4 9.5 9.6 9.7 9.8

10. Incentives to membership
10.1 It is recognised by the industry that it is important to have incentives for publishers to join the proposed system. Four such incentives are outlined in the proposal submitted to the Inquiry by Lord Black. These are: (a) (b) (c) (d) the provision of press cards; the use of agency copy through the Press Association; a “kitemark” for publications which are part of the system; and the way in which advertisers can support the system.

144

p21, para 29, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 145 paras 7.2-7.4 above 146 p4, para 9.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1. pdf 147 para 8.2 above 148 para 3.13 above 149 para 3.10 above 150 para 5.23 above

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Press cards
10.2 Press cards are currently issued under the banner of the UK Press Card Authority (UKPCA) by 17 gatekeepers ranging from the NPA to the National Union of Journalists. At present the press card simply confirms the identity of the holder and the fact that they meet the criteria of their gatekeeper, which loosely means that they are engaged in journalistic work.151 Lord Black told the Inquiry that under the proposal the issuing of press cards would be limited to journalists working for publications who were signed up to the self-regulatory regime, or other organisations such as a relevant industry body or a trade union.152 The basis on which bodies were accepted as ‘relevant’ in this context has not been set out in any detail. In addition to a limitation on who could be issued with press cards, the proposal is that the courts, Parliament, local councils, police, and sports and entertainment bodies would agree only to deal with journalists accredited with the new press cards.153 The Inquiry has seen no evidence of any discussions between the industry and these bodies on the proposal, nor has any evidence been taken from those bodies as to their willingness to participate in such an approach.

10.3

10.4

Access to agency copy
10.5 Paul Dacre, editor in chief of Associated Newspapers told the Inquiry that the newspaper industry owns the Press Association (PA) and that there are “significant  steps  afoot” to examine how the service could be denied to publishers who were not members of the new self-regulatory system.154 This proposal was described by Lord Black as “legally challenging”, particularly because of the competition issues raised; these are dealt with later in this Report155 and will be the subject of a report to the PA Board by September 2012.156

Kitemark
10.6 The provision of a kitemark as a badge of quality would be a matter for the Trust itself. Mr Dacre suggested that such a mark could be carried alongside corrections and clarifications columns to tell the public how to make a complaint and provide information on the process.157 Lord Hunt said that those who join the new regime should carry its badge with pride.158

Support from advertisers
10.7 No detailed proposal in relation to what support advertisers could give to the self-regulatory system has been provided. Mr Dacre suggested that advertisers, in particular Government and public sector bodies, might be persuaded not to advertise in newspapers which were

151 152

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p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf p22, lines 3-9, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 153 p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 154 p7, ibid 155 Part K, Chapter 4 156 pp23-24, lines 14-11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-AfternoonHearing-9-July-2012.pdf 157 p7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 158 p17, para 53, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Hunt-of-Wirral. pdf

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not subscribers to the scheme.159 The Inquiry has seen no evidence that any discussions have been held with any bodies which might be able to deliver a proposal in this regard and I cannot think of any commercial reason why advertisers would wish to go down this route, which could threaten to deprive them of access to one route to what might be a significant market.

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p8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf

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Chapter 3 analysis of the Model proposed by the pCC and pressbof
1. Introduction
1.1 The last Chapter set out the key features of the model presented by Lord Black on behalf of PressBof and the industry. This Chapter analyses that proposal, in particular in relation to the criteria set out in Chapter 1 above.

2. Effectiveness
The model must be perceived as credible by the industry
2.1 In the criteria for a new effective regulatory regime I said that a new model must be perceived as credible by the industry. One aspect of that credibility is the willingness of the industry to participate in it. It was recognised by Lord Hunt that a new system would not be perceived to be effective if a ‘big fish’ were not a part of it, accepting that Northern and Shell qualified as a ‘big fish’ for these purposes.1 He went further:2 “Q. ... of course if they don’t sign up and the devil is in the detail, then immediately the credibility of the new system would have been fatally undermined. That must follow, mustn’t it? A. Yes.” 2.2 Lord Black also accepts this by implication when he identifies the withdrawal of Northern and Shell from the PCC as evidence of a “significant structural problem” within the existing system.3 My own strong view is that no system of press standards regulation could be considered to be credible if one or more national newspaper publisher were not covered by it in some way, without any consequences as a result. So, does the model proposed by Lord Black meet that test? The proposal was submitted to the Inquiry by Lord Black in his capacity as Chairman of PressBoF, which is the co-ordinating body for the newspaper and magazine publishing industry’s trade associations. Those trade associations said:4 “While a lot of detailed work is still to be done, the proposals have the broad support of the organisations and their members. The proposals are being further developed in the light of comments received as part of the ongoing consultation process.”

2.3

1

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pp1-2, lines 14-14, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-10-July-2012.pdf 2 p3, lines 11-15,Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-10-July-2012.pdf 3 p3, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-of-Brentwood1.pdf 4 pp2-3, para 5, ibid

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2.4

Whilst this model has been offered to the Inquiry by the industry as a whole, some national publishers argued for ‘even tougher’ controls.5 Lord Black explained that that editors at The Independent, The financial Times and the Guardian had wanted to look at the whether some form of statutory underpinning might be necessary.6 These proposals have been the subject of three consultation processes, first on the broad architecture, then on an initial draft contract and set of regulations, and finally on a revised set of those documents together with draft articles of association for the new company. The proposal submitted to the Inquiry is the result of that extended consultation process.7 The consultations were primarily conducted through the trade associations, but the documents were also made available to those in the industry who are not members of any association.8 Industry readiness

2.5

2.6

Despite this extensive consultation process within the industry, it is clear that the proposals have not been developed to a stage where many, if any, publishers are yet willing to sign a contract with the new regulator. Section 6 below looks in detail at the evidence the Inquiry has had from the editors of national and regional newspapers, magazines and blogs about their views of Lord Black’s proposal and the extent to which they are now ready and willing to sign up to it. In summary, however, there are a handful of national newspapers which are signalling a clear willingness to join, almost irrespective of the final detail of the contract. A substantial number of other national titles have indicated willingness, in principle, to join but have indicated concerns on matters of detail and, in some cases, principle as well. Those national titles belonging to the Northern and Shell Group have indicated significant concerns about the proposals and reservations about joining the system. Among both magazines and local and regional newspapers there is broad support for the principles that underpin the proposals, coupled with a natural caution about committing to a contract where the details remain to be settled. A number of the editors who have given evidence have identified issues with the proposals that remain to be addressed, and which would prevent them from signing up to the proposal as currently drafted. None identified any points of principle that would prevent them joining at all if the proposal could be amended to meet their concerns. The editors of blogs who have provided evidence to the Inquiry largely felt that the proposal was irrelevant to them and offered them nothing. It is clear from this that Lord Black’s proposals enjoy wide support throughout the newspaper publishing industry, and that magazine publishers are also generally sympathetic to the approach. However, the nature of the views expressed is evidence of the process by which the proposals have been developed, with the national press at the heart of the structure. The fact that a number of major national newspaper publishers are willing to tell the Inquiry that they are committed to signing up to the proposed scheme is undoubtedly a positive sign. However, the fact that some of the national publishers are still expressing doubts on points of detail means that there must be doubt about the ability of PressBoF to secure the agreement even of these publishers to the model as presented. Further, the significant concerns on points of principle expressed by editors from the Northern and Shell group publications must indicate doubt about the likelihood of Northern and Shell ultimately deciding in favour of membership of the proposed body.

2.7

2.8 2.9

5 6

p2, para 4, ibid p10, lines 10-22, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 7 pp8-9, lines 3-3, Lord Black, ibid 8 p9, lines 4-12, Lord Black, ibid

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2.10

Under these circumstances, whilst it is clearly possible that all national newspapers would be prepared to join a system along the lines proposed, I cannot conclude with any certainty that the system proposed by Lord Black would have any greater coverage among the national press than the PCC currently does. This must be regarded as a significant flaw, albeit one that could be remedied by all major national newspapers signing a contract for membership of the new system. A new regulatory system must work for the whole press and the emerging digital market, not just for the national press. The local and regional press, with some magazines and online news providers, have identified a number of concerns about the compliance burdens, the cost, the ability of that part of the press to influence the system and the ability of the regulator to vary the contract without the support of all members. These are real concerns and I would anticipate that the publishers will want to see real answers to them before agreeing to sign up to the system. It might, for example, be sufficient to re-balance the burden of the costs between local and national publishers but, without detail, it is impossible to say. It would obviously be important from a credibility perspective that resolving these concerns should not significantly weaken the independence or regulatory power of the body proposed.

2.11

Incentives to join
2.12 Lord Black sets out four potential incentives that could be developed to encourage membership of the system. The first would be to limit the provision of press cards to journalists who work for an organisation that had signed up to an ethical code. The Inquiry has been provided with a copy of a proposal which was considered by the UK Press Card Association (UKPCA).9 The proposal would involve two changes to the process by which press cards are currently issued. First, the cardholder would have to make a declaration that they would abide by an appropriate ethical code. Second, there would be a requirement for the ethical compliance of the cardholder’s employer or, if he or she was freelance, his or her main client, professional association or trade union.10 The proposal would not include any change in the process by which foreign journalists are able to be issued with press cards.11 The UKPCA note that, in respect of broadcasters and newspaper and magazine publishers who are members of the industry self-regulatory body, there would effectively be no change to the current system. Broadcasters are already regulated by Ofcom and the UKPCA would accept membership of the new self-regulatory body as sufficient evidence of ethical compliance.12 The UKPCA notes that press agencies and picture agencies would need to become ethically regulated by subscribing to an appropriate code. The Press Association (PA) is currently subject to the PCC code.13 There would also be significant changes for individuals who operate on a freelance basis and for those organisations, such as professional organisations and trade unions, who act as press card gate keepers for them. In these circumstances the UKPCA would expect the gate keeper organisation to have or subscribe to an appropriate ethical code. It is noted that the NUJ already has its own code. In addition, these gatekeepers would have to certify that, where they were issuing a card to a journalist who is an employee,

2.13

2.14

2.15

9

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UKPCA proposal, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/10/Second-submission-from-MikeGranatt1.pdf 10 p5, para 12, ibid 11 p6, para 16, ibid 12 pp6-7, paras 20-21, ibid 13 p7, paras 22-23, ibid

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that the employer is itself signed up to appropriate ethical regulation. In other words, a union could “not issue a UK press card to an employee of a newspaper not signed up to the PCC’s successor”.14 2.16 In the case of unaffiliated freelancers (those who are not members of a professional association or a trade union who acts as a gate keeper for the UKPCA) a UKPCA subcommittee would be established to consider eligibility; those found to be eligible by the subcommittee would be helped to find a gatekeeper.15 Some significant questions remain unanswered by the proposal. Specifically it is recognised that the scheme would need to deal with questions of eligibility, complaints, misuse, misbehaviour and breaches of ethical codes. The UKPCA proposal says that withdrawal of a card should only be by decision of the gatekeepers’ committee.16 This proposal was considered by the UK Press Card Association on 10 July 2012 but did not achieve the 75% majority required for a rule change. The UKPCA has no plans to revisit this issue.17 Mike Gannatt, the Chair of the UKPCA, gave it as his opinion that this was due not to any objection in principle to incorporating an ethical dimension to accreditation, but to the attempt to link that with a regulatory regime:18 “The kitemark proposal foundered over its additional intention to coerce compliance with self-regulation. This created insurmountable conflicts of opinion and interest.” 2.19 Despite the UKPCA decision, it is worth considering the merits and disadvantages of the proposal in case it should be raised again. A number of witnesses to the Inquiry have raised substantive concerns about it. Harriet Harman QC MP pointed out that the risk with this proposal that citizens and bloggers could be excluded from access to public information. The many private organisations, such as sports clubs, who hold press conferences might not want to be a part of such a proposal. The more significant risk was that individual journalists might lose their accreditation when a wider culture within a publication was to blame. Essentially, she said, this proposal was akin to licensing and could inhibit a free press.19 Angela Philips echoed all of these concerns, saying that it would, in effect let the tabloid press decide who was going to be allowed to be a journalist.20 There would be no way to protect a journalist who fell out with management at his or her newspaper who could then simply revoke his or her press card.21 Similarly, Ofcom noted that there would be some definitional difficulties in defining a journalist in a digital environment and that such a system could potentially have a restrictive effect on rights of freedom of expression.22 The Media Standards Trust regarded the proposal as:23

2.17

2.18

2.20

pp7-8, paras 24-26, ibid p8, para 27, ibid 16 p9, para 30, ibid 17 p1, ibid 18 p2, ibid 19 p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf 20 Senior Lecturer in the Department of Media & Communications, Goldsmiths, University of London 21 pp35-36, lines 3-13, Angela Philips, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-13-July-20121.pdf 22 p10, para 4.13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 23 p60, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf
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14

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“flawed; it is outdated in an age of digital media; discriminatory against the individual blogger or concerned citizen; most likely at odds with the commercial interests of many of the organisations it seeks to engage with; and perilously close to a licensing of journalism by non-state means.” 2.21 2.22 By contrast, the Media Regulation Roundtable24 and Professor Roy Greenslade25 noted the proposal was a worthwhile potential benefit to being a member of a self-regulatory system. I share the concerns of those who liken this proposal to the licensing of journalists. It seems to me that the risk of this working in a way which is damaging to competition and freedom of speech is high. It also seems to me that it puts individual journalists very much at risk of being expected to take the consequences of ethical breaches that they may have been pressured into by the culture or practice operating inside the newsroom in which they were working. In addition to those concerns, I am not convinced that those who want to get their message across to the media will see any benefit in cooperating with this proposal, so its effectiveness as an incentive to membership of a self-regulatory regime may well be limited. I do not regard this as either a sufficient, or a desirable, approach to encouraging publishers into a self-regulatory standards regime. The second incentive proposed is that the Press Association was looking to see whether it could provide an incentive to membership of the self-regulatory body by varying the terms on which it supplies services to non-members.26 A proposal of this sort would undoubtedly raise serious questions about compatibility with competition law. PressBoF has helpfully set out the arguments that support the theory that such an arrangement could be considered.27 Even if it were to be in breach of s2 of the Competition Act 1998, such an arrangement might be allowed if it were inherent to the regulatory proposal or if it could be objectively justified as being in the public interest in raising the professional and ethical standards of the press. It is not possible to take a view on whether a proposal of this sort would, in fact, meet any of those tests without seeing the detail of the proposal. Even if it were to meet those tests it would also have to be proportionate and the least restrictive method of achieving the desired outcome: I am not at all satisfied that this would be the case. The impact of this proposal would also depend heavily on what was involved. There is a substantial difference, for example, between refusing to supply publishers with copy or supplying them on different terms and conditions. In any case, other press agencies exist and it is possible that a publisher outside the system may be able to replace PA services. The third incentive proposed is access for members to a kitemark to signify quality, and the fourth is an entirely undefined suggestion that the advertising industry might be able to help. I look at these ideas in a little more detail later on, but essentially there is little to suggest that either would be particularly effective as incentives.28

2.23

2.24

2.25

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p21, para 72, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 25 p16, para 14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 26 pp23-24, lines 23-11, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 27 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/10/Second-Submission-from-PressBof-in-relation-toModule-4.pdf 28 section 5 of Chapter J5

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2.26

I cannot escape the conclusion that this package of incentives, particularly given the position now reached by the UKPCA, does not constitute a compelling argument for any publisher to join the body if they were otherwise not inclined to do so. I am very keen to find incentives to persuade publishers into independent voluntary regulation and I find it somewhat disappointing that the industry, with their own knowledge of what is important to them, have not managed to come up with a more compelling package than this.

Contract issues
Contract term 2.27 Membership of the system would be by a five year rolling contract. The contract would require members to pay the agreed levy for the duration of the contract and would bind members to comply with the provisions of the contract, including compliance with the code and co-operation with investigations, even if they were otherwise to leave the system during the term of the contract.29 Should such a five year contact be signed, it would provide a reasonable degree of certainty for the system for five years. However, there is no certainty over what might happen next. Lord Black suggested two possibilities:30 “It could work on a 12-month rolling cycle after the five-year term has ended. There is another possibility, that the five-year break term could be used to review the terms of the contract and publishers, if they agree, could then enter another five-year contract.” 2.28 The continuation of the system proposed by Lord Black beyond the initial five year period would be entirely dependent on the willingness of the industry to enter into a further contract. Furthermore, it is entirely possible that at that point the majority might decide to create a much less robust system. Lord Black told the Inquiry that he could not see circumstances in which that would happen. Instead, it would be an opportunity for consideration of how well the system worked and any improvements that could be made.31 He said:32 “So it’s a break-point that should work, I think, in both ways.” 2.29 In practice, this must represent a very real risk to the sustainability of the proposed model beyond the first five year term. I recognise that no system of regulation could be expected, or wished, to last for ever, but this degree of built in failure seems problematic. Nor is it clear to me how this could be remedied. I entirely accept that it is not possible to bind people to a contract in perpetuity, in which case this would appear to be a fundamental problem with a system which is held together only by contract. Transfer of title 2.30 Should a member wish to transfer a title to a non-member they are required to use “all reasonable endeavours” to ensure that the new owner is a member of the regulatory scheme.33 This stops short of the more obvious requirement that a title may not be transferred

p5, para 11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1. pdf 30 p43, lines 7-11, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 31 p44, lines 1-12, Lord Black, ibid 32 p44, lines 12-13, Lord Black, ibid 33 p3, para 3.1.8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1. pdf

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unless the new owner signs a contract with the scheme. Lord Black explained that the looser formulation was intended to protect the position of proprietors of local newspapers, where a degree of consolidation in the market is expected and proprietors are reluctant to have their hands tied in the matter of potential purchasers. However, Lord Black pointed out that most transfers of titles were likely to be between publishers who were already members of the system so the issue would not arise often.34 I recognise the concern expressed in relation to the economic difficulties faced in particular by local newspapers. However, this is a rather obvious weak link in the argument that the contract binds newspapers into the system. Contract variation 2.31 The structure of the system is that all publishers would enter into a bilateral contract with the regulator. Those contracts would all be identical. The contract could be varied where a majority agrees to variation. The precise mechanism for this is not set out in the proposal put to the Inquiry. Lord Black explained that the majority would have to be calculated on the basis of weighted votes:35 “If it wasn’t weighted votes, you could have a situation in which, because they are much greater in number, the magazine publishers could change the contract by outvoting everybody else. So we need to have (sic) find some way of doing that which gives no group of regulated entities a power of veto over changes, but that the voting procedure reflects the nature and diversity of the market. I can’t pretend we’ve cracked that one.” This is a potentially significant issue. Some in the industry have raised their unease about being subject to a contract which could be varied without their agreement. Clearly the exact nature of the weighting will be an important issue for all in the industry and may be difficult to resolve. Should it not be possible to reach agreement on a method of varying the contract by majority, the only alternative would be for any change to require unanimity; this would make changes extremely difficult to achieve. Enforcement 2.32 As further explained in paragraphs 5.23-5.35 below, the contract model is designed to introduce a measure of internal enforceability. I underline ‘internal’, because it is of the essence of the contractual arrangement that it is not intended to be enforceable at the suit of a third party – a reader, say, or member of the public. It relies in other words on a credible prospect of (expensive and uncertain) litigation proceedings between the press organisations themselves to enforce the contract against each other. There must be real questions about that credibility in real life. The likely motivations of press organisations to contemplate suing each other to retain commitment to the contract are very far from clear. In any event, classically, contractual disputes tend to be settled commercially by the payment of compensation rather than the specific enforcement of the terms of a contract. Even within the terms of the contract, there is at the very least an area of doubt and complexity about the extent to which financial penalties could be enforced in a contract action.

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pp108-109, lines 21-16, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 35 p116, lines 13-22, Lord Black, ibid

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The model must be perceived as credible by the public
2.33 Any new model must also be perceived as credible by the public. The industry has not attempted to conduct any consultation with the public on the proposals put forward or taken any steps to understand public expectations of press standards. Lord Black told the Inquiry that this was due to a lack of opportunity to do so but suggested that newspapers would be uniquely well placed to “take the temperature of the public” on the proposals if that was felt to be helpful.36 Similarly, Lord Hunt said:37 “One thing which I had been contemplating is that at some stage we ought to have a public consultation, but I felt that to do anything in that direction would be wrong pending the result of this Inquiry.” 2.34 I find it extraordinary that, given the acceptance by Lord Black and the newspaper industry that the current system of press regulation has lost public confidence, they did not regard public views on the matter as of sufficient interest or importance to make any effort to ascertain them. I find it more extraordinary that, having had its attention drawn to this point by the Inquiry, there is still no sign of the industry making any effort to understand public expectations in relation to press standards. This lack of interest in the views of the public may be symptomatic of the approach that the press has consistently taken towards regulation over many decades. It demonstrates the extent to which the press continue to prioritise their own interests, with consideration of the wider public interest only in as much as it applies to the importance of protecting the freedom of the press, and only then to the extent that they can appoint themselves the arbiter of it. The Inquiry placed Lord Black’s proposal on the Inquiry website and sought comments from interested parties and the general public. For the most part the responses have been from those already engaged with the Inquiry. A submission on behalf of the Core Participant Victims said:38 “The Module 4 CPVs have considered the submissions and evidence of Lord Hunt and Lord Black. The Module 4 CPVs all agree that the proposal advocated by Lord Hunt and Black for a new contractual self-regulatory body would not be a satisfactory solution. The proposal is considered to be an insufficiently clean break from the current PCC and the failings associated with that organisation. In the event that this system was established, it is anticipated by the Module 4 CPVs that complainants would be likely to prefer court proceedings as a forum for seeking redress.” 2.37 Harriet Harman QC MP listed her concerns with the proposal:39 “Our concerns are: The system would remain voluntary – newspapers would be free to choose whether to opt in or not. Members of the public who wanted to complain about non-members would have no redress
36 37

2.35

2.36

pp34-36, lines 24-1, Lord Black, ibid pp20-21, lines 24-2, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-10-July-2012.pdf 38 p2, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Joint-Submission-by-Core-ParticipantVictims1.pdf 39 p2, para 1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MPon-behalf-of-the-Labour-Party1.pdf

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It is by no means certain that all publications will sign the contract, whether new entrants to the market would sign in future, or whether signatories would renew any contract There would be a chilling effect on the system as adverse adjudications could deter proprietors from signing the contract or renewing the contract The system would not be independent – it would still be run by the industry, for the industry Contracts would be between the press itself – they would not necessarily help the public.” 2.38 The Media Standards Trust similarly raised concerns that there were insufficient incentives either to join or to stay in the system and that the reliance on goodwill to keep publishers in the system would make it difficult to impose any meaningful sanction on a publisher.40 The British and Irish Ombudsman Association said that they did not consider the proposed model to be appropriate because it would be wrong for the dispute-resolution body not to be independent of the regulator and the remedies proposed were too limited.41 Benefits to the public 2.40 It is important to note that the proposal put forward by Lord Black gives no rights of any sort to members of the public. The contracts are between the publishers and the regulators. Third parties have no rights under the contract and nothing else in the proposal gives those who are either customers of the press or victims of press behaviour any rights in relation to complaints or redress. Lord Black acknowledged this, but suggested that the rights of third parties would be protected by the potential to take an action for judicial review.42 Whilst it is arguable whether the Trust, as envisaged in this proposal, would be subject to judicial review, Lord Black repeated to the Inquiry that it would be unlikely that the industry would contest that point.43 This is not a sufficiently credible answer. It is surprising, given the evidence that has been put before the Inquiry of the harm that the press can do, and have done, to the lives of ordinary individuals, that the industry has not felt it necessary to address anywhere in the system the rights of individuals. I have said, many times, that any new regulatory system must work for the public and for a system to work for the public it should have the rights and interests of the public at its heart. This proposal manifestly fails that test.

2.39

2.41

What difference will it make?
2.42 The credibility of the system must also depend on the impact that it would have. The Inquiry sought evidence from editors as to the practical differences that the proposal would make if it was implemented. The detail of those responses is set out below,44 but the overwhelming answer was that it would make no practical difference whatsoever. Some editors noted that

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p35, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf p14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-British-and-Irish-OmbudsmanAssociation.pdf 42 p117, lines 23-25, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 43 p118, lines 5-8, Lord Black, ibid 44 Section 6
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they would have to make procedural or administrative changes, but there was no suggestion from any editor that Lord Black’s proposal would require any changes to the ethical conduct or approach to standards within their title. 2.43 It is fair to say that all the editors who provided evidence argued that standards in their newsrooms were already high and it might be argued that the question could be said to assume, for each title, that change was necessary. I simply note that the abuses of which the Inquiry has heard evidence, and which are documented in this Report, have happened under the current systems of standards governance in place within newsrooms and that all have recognised that the public has lost confidence in that system. If the proposals put forward by Lord Black would not make any practical or cultural difference, then it is difficult to see how they could be said to be a sufficient answer to the problem that the Inquiry has identified. Scope and membership 2.44 The proposal includes provision to allow the Industry Funding Body (IFB) absolute discretion to refuse membership. Lord Black explained that this provision was essentially to allow the industry to refuse membership to top shelf publications, whose membership would be wholly inappropriate because they would only give rise to complaints about taste and decency, which was outside the scope of the body.45 I find this problematic. First, it is difficult to see why it should be the IfB, rather than the Trust itself, which takes decisions on whether or not it is appropriate for a publisher to be a member of the Trust. Secondly, and of greater significance, the provision as drafted allows the IFB to refuse membership to any publisher for any reason, giving rise to the possibility that a publisher could be excluded for commercial or other reasons. finally, I do not understand the problem about taste and decency. If such a complaint is outside the scope of the code (as at present), it will be very easy to deal with it. It seems to me that it is essential that any regulatory body, self or otherwise, should be open to all in the industry to participate in on a fair, reasonable and non-discriminatory basis.

3. Fairness and objectivity of standards
3.1 3.2 This criterion specifies the need for a credible statement of ethical standards, set in a way that is sufficiently independent of media interests to command public respect. Under Lord Black’s proposal the Code Committee would retain responsibility for defining the standards to be complied with by the press, including the definition of the public interest, albeit with the regulator having to approve any changes to the code. The Code Committee would comprise 17 members, of whom 12 would be serving editors, with three public members and the Chair and Chief Executive of the regulator.46 This clearly puts the definition of the public interest in the hands of industry, not of the public as represented by the majority independent members on the Board. Lord Black was reluctant to contemplate the idea that the Committee might instead, have an equal number of public members and serving editors:47

p106, lines 11-15, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 46 p38, lines 4-14,Lord Black, ibid 47 p39, lines 4-12,Lord Black, ibid

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“I think that the Code Committee is, in effect, the only – because there are independent majorities throughout the rest of this, the Code Committee is the only genuinely selfregulatory bit. I think there is significant moral authority that comes from a code which is written by a committee with significant public involvement but that is written by editors. So I think there would be some fairly robust views expressed about a view that there should be parity on that.” He indicated that, in his opinion, the industry would be unlikely to accept such a change.48 3.3 If one were to accept that it is reasonable for the industry to be in a majority in writing the code, it is also worth considering whether it is appropriate that those representing the industry should be serving editors. Lord Black argued that this was essential:49 “this has always been the Editors’ Code and it has always been the view that it is important that editors write it. That is the way that their newsrooms buy into it. That is the way the publishers buy into it.” 3.4 Lord Black denied that serving editors would have a degree of self-interest in how the standards set in the code:50 “LORD JUSTICE LEVESON: It might be thought they have a certain degree of selfinterest. A. They have self-interest in making the code work. MR JAY: I think it was you, Lord Black, who used the phrase “buy into it”, which is a synonym for self-interest, isn’t it? A. No, I don’t think it is a synonym for self-interest. I meant “buy into it” in terms of they are the ones that have got to make sure their colleagues stick by the letter of it, they’re the ones that have to deal with any complaints that come in under the terms of it. They need to know that it is a practical document. They need intellectual buy in, as much as anything else.” He argued instead that only serving editors would have the practical day-to-day understanding of what life was like in newsrooms and how the rules needed to change to reflect that.51 3.5 I simply do not accept that. Whilst I recognise the importance of having a strong editorial voice advising on standards, it seems to me quite wrong that editors should actually be responsible for setting standards. It would be quite reasonable for the Trust Board to be advised by the Code Committee, constituted as Lord Black proposes, but the Board should retain responsibility for the code. It is arguable that the Trust Board does have the final say on the code in this proposal, as they would have to agree any changes to the code, but the distinction is important. Whatever mechanism is put in place as to the weight to be attached to advice from the Code Committee, I am not clear that allowing serving editors to set the code provides sufficient independence from the industry to command public respect.

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48 49

p39, lines 12-18,Lord Black, ibid p40, lines 4-8,Lord Black, ibid 50 p41, lines 10-16,Lord Black, ibid 51 pp40-41, lines 16-3, Lord Black, ibid

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4. Independence and transparency of enforcement and compliance
4.1 This criterion covers the mechanisms for enforcement and compliance, the independence of the bodies carrying out those roles and the methods by which they do so.

‘Independently led self-regulation’
4.2 Lord Black presented the model as ‘independently led self-regulation’:52 “it is a self-regulatory system because it is generated from within the newspaper industry and relies on the newspaper industry for funding, but it is independently led in that all the component parts of the regulator have very clear independent majorities in it and that those independent majorities are guaranteed by the independent appointment processes that the trust board will put into place. So it is self-regulation but it is led and managed by a wholly independent body.” 4.3 It is worth considering what is meant by ‘independently-led’ here and the extent to which the proposals address the fundamental requirement for independence. The first issue that commonly gives rise to an impression that the current system is not independent is the presence of serving editors on both the Code Committee and the Complaints Committee. The proposal before the Inquiry retains both, albeit with the addition of an independent voice in the Code Committee. Lord Black defended this position:53 “I used the phrase earlier “independently led self-regulation”. If the “self” in that phrase is to mean anything, then it has to mean the presence of editors on the Code Committee, albeit buttressed by a minority of lay members, and it has to mean the expertise of senior serving newspaper figures on the complaints committee, again, though, in a substantial minority. What we’ve tried to do here is to make sure that actually the complaints arm and the standards investigation arm are structurally shielded from the industry funding body, whose powers are significantly diminished from the existing Press Standards Board of Finance, which is why the key in this body is the presence of this new trust board.” 4.5 I do not accept that the concept of ‘self-regulation’ requires the presence of serving editors either on the body that sets the standards, although, as I have indicated, I recognise that it would certainly be desirable that serving editors should have an advisory role in standards setting, or on the body that takes decisions on complaints. Self-regulation can equally mean self-owned and self-designed regulation, by independent people, led by a Chairman appointed by a panel which included ‘self’. The Industry’s unwillingness to address public concern on this matter is a real indication that the proposal to a significant extent represents a broad continuation of the status quo rather than a fundamental shift in attitude or an acceptance of the need for independent regulation. The second issue that has been raised, particularly in the context of Mr Desmond’s decision to leave the PCC, is the way that a few powerful individuals have been able to dominate the system. This has been an observed flaw in the existing system and Lord Black acknowledged

4.4

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pp45-46, lines 21-4,Lord Black, ibid pp78-79, lines 14-3, Lord Black, ibid

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that there is nothing in the new system to prevent it from recurring or continuing.54 This therefore remains a weak point in the proposed system, which would need to be addressed for the new system to be genuinely independent.

Objects
4.7 It has been pointed out by a number of commentators that the proposal is very much focused around the industry’s interests. This is particularly evident in the formulation of the objects of the Community Interest Company that would be the regulator:55 “Activities which benefit the community, in particular to promote and uphold the highest professional standards of journalism.” […..] “Having regard at all times to the importance in a democratic society of the freedom of expression and the public’s right to know.” There is nothing in these objects about the rights of individuals or the importance of the public interest in other rights beyond freedom of expression, such as an individual’s right to privacy. Lord Black argued that these concepts were embodied within the phrase “the highest professional standards of journalism”.56 I can see no reason why it would not be sensible for these matters to be reflected explicitly in the objects of the regulator, and I welcome Lord Black’s statement that he has no objection to the Article 8 rights being set out.57

Independence from Government
4.8 This criterion, which is clearly extremely important, requires that the enforcement of standards should be independent of Government. Lord Black argued that the only way to ensure this independence was to have full self-regulation with no statutory involvement of any kind. I look in detail at the arguments surrounding statutory recognition of self-regulation and statutory underpinning to self-regulation later in the Report.58 Here it suffices to say that the proposed industry model has no point of contact with Government and would certainly remain independent from Government.

Structures and appointments
4.9 The independence of the system will depend largely on the structures, but also on the independence of the procedures by which key post holders are appointed. The Trust Board 4.10 The most important appointment, self evidently, is the Chair of the Trust Board. The appointment of the Chair, who would have no press background, would be made by a four person panel with two industry members and two public members, making a unanimous decision.59 Lord Black defended this process as “independent of press interests” on the

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pp79-80, lines 15-5, Lord Black, ibid p4, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-D1.pdf 56 pp27-28, lines 25-3, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 57 pp28-29, lines 25-1,Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 58 Chapter 5 59 p50, lines 7-11, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf
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grounds that it was a “balance” with neither press nor lay interests having control of it.60 I do not find this entirely convincing. A requirement for unanimity across an equally weighted panel effectively gives a veto to either side. That is certainly balance of a kind, but it puts a considerable amount of influence in the hands of the industry in relation to what should be an independent appointment. Lord Black indicated that the proposal in front of the Inquiry was the industry’s “best current shot”61 and that he would look at an alternative model that would provide a majority of lay members on the panel.62 In my opinion, it is of fundamental importance that the Chair of any regulatory body should be independently appointed, and a mechanism that puts a veto in the hands of the industry does not constitute an independent process. 4.11 The other members of the Board would be three lay people and three press representatives. The lay people would be appointed by an independent process to be determined by the Board. The industry representatives would be individuals with senior editorial or publishing experience, but not serving editors, and would be appointed by the IFB.63 If the issue around the appointment of the Chair were resolved, these procedures would appear to provide for independently appointed independent members to hold the majority on the Trust Board. It would also be important that, if those appointed with editorial or publishing experience remain in employment, they are appointed with true independence and not merely as proxies. The Code Committee 4.12 The Code Committee would comprise 12 or 13 industry members, drawn from across the industry.64 These 12 or 13 would be serving editors but no evidence has been presented on how they are to be “drawn from across the industry”. The Chairman and the CEO of the Trust would automatically sit on the Code Committee, and the Trust Board would appoint a further three public members who may, but do not need to, be members of the Board or of the Complaints Committee.65 The proposal to introduce public members to the Code Committee must be regarded as a positive step. I have already set out my views on the extent to which it is inappropriate to have serving editors responsible, albeit subject to the approval of the Board, for setting the standards to which they are expected to adhere. I do not, therefore, regard the Code Committee, in a standards setting capacity, as sufficiently independent of industry. As I have equally made clear, however, I do think that the body as described could operate appropriately as an advisory body with the Trust Board having final responsibility for the code. I appreciate that advice from such a body would have to be accorded appropriate respect, that it would be important for editors to ‘buy into’ the code and that the Trust Board would therefore be extremely reluctant to approve a change contrary to the views of the Committee but, although to some extent symbolic, the difference is important. As will equally be clear when considering the Complaints Committee below, the suggestion that those in charge of the regulated entities should be responsible for the code pursuant to which they are regulated is not one that would (or should) command support.

4.13

p94, lines 16-21, Lord Black, ibid p95, lines 23-24, Lord Black, ibid 62 p96, lines 16-18, Lord Black, ibid 63 p24, para 38, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 64 pp40-41, para 79, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf says “13 members drawn from across the industry” whereas in oral evidence Lord Black said that there were 12 industry members 65 p41, para 80, ibid
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The Complaints Committee 4.14 The Complaints Committee comprises the Chairman of the Board, seven lay members appointed by an independent process, and five working editors.66 One concern would be that having serving editors on the complaints body creates the perception, at the very least, of a lack of independence. Indeed, it is the presence of serving editors on the Complaints Committee that gives rise to the concept of editors marking their own homework. Ed Richards and Colette Bowe from Ofcom gave their clear opinion that:67 “in terms of code setting, in terms of sanctions, in terms of corrections or anything of that kind and in terms of policy making overall, you need to have a bright line separation between those who are regulating and making decisions and those who are regulated, and I think any breach of that [….] means that you will immediately undermine the perception and indeed in reality the actuality of your independence.” Lord Black argued that the industry view was that:68 “these need to be people who are absolutely at the cutting edge of their trade.” He said that the independence of the Complaints Committee was adequately ensured by the independent majority on the Committee and the right of appeal to an independent assessor:69 “I think that body is constructed so that it has a tangibly clear independent majority on it, and we’re also, as you’re seeing at the bottom, building in an independent assessment of that. So if there was a member of the public who had any concern about the process in the way it had been handled, that one of these minority editors had had some sort of undue influence, that independent assessment, which would be by somebody who had nothing to do with the newspaper industry, would be thrown up.” 4.15 The possibility that retired editors, for example in academic positions, or an NUJ representative, could provide the required knowledge to the Committee was dismissed by Lord Black, although someone who edited a ‘website within a newspaper’ might be considered.70 Again, I do not consider that this brings the required degree of independence from industry to the enforcement of standards. An argument is often advanced that doctors sit on the British Medical Association disciplinary panels so there cannot be a problem with editors on the Complaints Committee. The problem with this argument is that individual doctors are not to be compared to editors: there is only a very small pool of national editors to draw from, making it impossible to create a panel where the members would not know the people on whom they were adjudicating and have views about them and their title. I have not considered whether it would be appropriate for there to be a role for a serving editor to be able to provide written advice to the Complaints Committee, but I do not accept that the Committee should have serving editors sitting on it.

4.16

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pp50-51, lines 24-5, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 67 pp101-102, lines 7-9, Ed Richards and Colette Bowe, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Transcript-of-Morning-Hearing-12-July-2012.pdf 68 p52, lines 14-17, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 69 p52, lines 9-18, Lord Black, ibid 70 pp52-53, lines 19-7, Lord Black, ibid

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The Compliance and Investigation Panel 4.17 The Trust Board would maintain a ‘pool of experts’ from whom they could appoint a Compliance and Investigation Panel when the need arose. The names of the people in the pool would be published and each specific panel would be appointed, by the Trust Board, to suit the specific demands of an investigation.71 The basic structure here seems sufficiently independent from any relevant interest. The Inquiry has not been given enough information about the methods by which the experts will be appointed to the panel to take a view on the adequacy of those processes, but there are no immediate concerns here. The Industry Funding Body 4.18 The Inquiry has been given no information about the composition or, of appointment procedures for, the IFB as Lord Black explained:72 “while we have been able to establish some general principles about its operation, the details are still in progress, and will need to be subject to a further round of industry consultation.” Clearly the IfB will not, and cannot, be independent of industry. It is undeniable, however, that there is very real merit in it being considerably more transparent so that the public are aware of the different influences within the IFB. The most significant point of interest is around the relationship between the IFB and the Trust Board. Relationship between the IFB and the Trust 4.19 One of the arguments put forward by Lord Black as to the enhanced independence of his proposal, by comparison with the PCC, is the fact that the IFB has a relationship only with the Trust Board, not with the operational parts of the regulatory organisation. This assertion bears closer scrutiny, in particular as it impacts on the investigations and compliance role of the regulator. An exchange between Mr Jay and Lord Black sets out clearly the extent to which the Trust Board, with whom the IFB have their direct relationship, has responsibility for all the significant decisions in relation to an investigation:73 “Q…but are we agreed to this extent: that trust board approval is required to establish an investigation? Is that right? A. Yes. Q. Trust board approval is also required to take action to enforce the contract in relation to an investigation; is that right? A. Yes. Q. The trust board, you’ve told me this earlier, handles appeals against a finding of the compliance and investigation panel. A. By setting up a new panel. Q. By setting up a new bundle (sic). And the trust board must take the decision on raising any fine in relation to an investigation; is that right?
pp53-54, lines 16-6, Lord Black, ibid p1, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/10/Fourth-Witness-Statement-of-Lord-Black. pdf 73 pp101-102, lines 10-3, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf
72 71

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A. Correct. Q. And the trust board also ratifies changes to the code, doesn’t it? A. Yes.” 4.20 Whilst there is nothing objectionable in the Trust Board having these roles in respect of investigations, it is not possible, in the light of this, to also argue that the IFB, by interacting only with the Trust Board, has no interactions with parts of the body that are taking regulatory decisions. The Trust Board is quite clearly taking regulatory decisions here; indeed, it is responsible for all of the most significant regulatory decisions in relation to an investigation. Lord Black argued that this would not matter as investigations would be funded from a ring-fenced enforcement fund, which is to be established at the outset and will not be the responsibility of the IfB.74 This is not a sufficient argument. The influence of the IFB derives from its position as the funding body for the regulator, but is not therefore limited to matters that fall to be funded by it. The risk, surely, is that the Trust Board might seek to avoid causing friction with the IFB in relation to investigations in order to preserve a good relationship on the wider funding issue. The IFB has a number of other roles in the system. It is responsible for the code, although the code must be agreed by the Trust. The Trust is responsible for the Regulations, though they must be agreed by the IFB. These complementary roles provide a model of regulation in which the industry has a very strong say, both through being in the lead in setting standards and having a veto over the Regulations governing the maintenance of those standards. Lord Black argued that this was a very important system of checks and balances, to protect the industry from a regulator which might want to make changes that would destroy the industry whilst simultaneously protecting the regulator from any attempt by the industry to scale back regulation. He did, however, suggest that a stipulation could be added to the contract that no changes to the contract or to the regulations could ever dilute the power of the regulator.75 In relation to changes to the code, Lord Black said that the Trust Board would have the ultimate responsibility for a change, with the IFB essentially having a role in managing a prior consultation process. He recognised that this was not what the documents provided to the Inquiry set out and that some redrafting would be necessary to achieve that effect.76 The powers of the IFB, which run throughout this proposal, undermine claims to independence of the regulatory system. Lord Black talks of independently led-self regulation but it is not clear that leadership in this system can come from the Trust. Rather, there is a joint system of leadership between the Trust and the IfB in which the IfB has the lead in many important issues, in particular the funding of the body, the definition of the code and setting sanctions guidelines; it also has significant influence in many others, such as the appointment of the Trust Chair and changes to the Regulations. Removing the IFB from decision relating to appointments, the code, the Regulations and sanctions would go a long way to enhancing the independence of the proposed system.

4.21

4.22

Complaint handling
4.23 Members of the new system will be expected to try to resolve complaints directly with the complainant in the first instance. The intention here is to improve transparency and accountability within publishers, as well as to reduce the workload for the regulator.77 This is a sensible development.

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p102, lines 13-18, Lord Black, ibid p111-112, lines 18-7, Lord Black, ibid 76 pp115-116, lines 1-2, Lord Black, ibid 77 p2, lines 11-16, Lord Black, ibid

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Third party complaints
4.24 The proposal would give the regulator the power to take up a third party complaint where there has been a significant breach of the Editors’ Code and there is a substantial public interest in allowing the complaint to be brought.78 Lord Black gave evidence that the new body, in line with current practice in the PCC, would always be able to take third party complaints on a matter of accuracy.79 That is not reflected in the drafting of the regulations, which would appear to restrict third party accuracy complaints to “significant breaches” with a “substantial public interest”. Lord Black provided assurance that it was not intended to have that effect, but on the contrary was intended to make it easier for groups to bring discrimination complaints under the discrimination clause of the code;80 it remained important, however, for the regulator to have discretion over when to take up third party or group complaints on issues such as discrimination.81 As it stands, this wording appears to significantly raise the threshold for third party complaints about accuracy. I accept Lord Black’s assurance that this is not the intention but it is important that that point should be clarified.

Compliance reports
4.25 The proposed scheme introduces annual compliance reports which would set out compliance systems and report on any compliance breaches and the steps taken to remedy them. These reports form an important part of the standards function of the new model. The reports would be sent to the Head of Standards and Investigations (an official position at the Trust) whose team would analyse the reports. It is anticipated that this will lead to dialogue with the publishers about the actions that they have taken over the year and the extent to which the report demonstrates active compliance with the standards. Once the reports are finalised it is expected that they will be published. The contract would require regulated entities to be open and cooperative towards the regulator and to disclose any significant breaches of the code promptly.82 It would be open to the Trust to take action, including potentially the launch of a full scale investigation, to require the reports to be full and frank should that be necessary. The process of reaching agreement on the annual report between the publisher and the regulator would be a proportionate one, taking into account the size and nature of the publisher.83 This proposal strikes me as an eminently sensible one. It must be right that the primary responsibility for compliance lies with the company and they should be encouraged to take that responsibility seriously. A requirement of this sort should significantly enhance the transparency of compliance across the industry and put pressure on management within each title to ensure that they have a good story to tell. It might also be reasonable to suggest that newspapers should publish their annual compliance reports in their own pages to ensure that their readers have easy access to the information.

4.26

p2, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1.pdf p13, lines 6-23, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 80 p16, lines 19-21, Lord Black, ibid 81 p14, lines 11-14, Lord Black, ibid 82 p2, para 3.1.3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1. pdf 83 p61, lines 2-9, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf
79

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4.27

The proposal also requires publishers to identify a named senior individual within each company who is responsible for the maintenance of standards, compliance with the code of practice, reporting annually to the regulator and then dealing with the follow up from the regulator.84 Arguments may be made about whether that senior individual should, of necessity, be the editor or the proprietor but, in any event, this also seems like a sensible innovation that could, if operated properly, encourage real change within organisations.

Whistleblowing
4.28 Lord Hunt raised a concern that had not been picked up by the industry proposal, namely that there should be a whistleblowing hotline into the new regulatory structure for those who feel that they are being asked to do things which are contrary to the code.85 It is a shame that this has not been taken on board by the industry proposal: it is obviously sensible.

5. Powers and remedies
5.1 The sanctions available to the regulator differ substantially depending on whether an issue is dealt with via the complaints arm or the standards arm. The Complaints Committee has the power to issue an adverse adjudication, and to negotiate the wording, size and placement of a correction or apology, but it cannot impose a fine, even in an egregious case.86

Complaints
Lack of adjudication 5.2 Lord Black explained that conciliation remained at the heart of the proposed complaints process because “the bulk of complaints will lend themselves to conciliation.” 87 It would be open to the regulator, in the case of a serious breach that could nonetheless be resolved to the complainant’s satisfaction by way of conciliation, to reach a full-scale adjudication. The Complaints Committee can call on a publisher to take disciplinary action against an editor. My concern in this context is that a great proportion of the complaints made to the PCC currently are rejected at the first point of contact, and the vast majority of those that are looked at are resolved through mediation. Just because it has proved possible to resolve a complaint to the satisfaction of the complainant without a formal adjudication there is no guarantee that a breach of the code was not committed; indeed, the reverse is likely to be the case on the basis that the clear cases will be conceded and redress provided. On the other hand, only those few that go to a full adjudication ever get to the stage at which a breach of the code is recorded. This allows the fiction that only a handful of breaches of the code occur each year to go unchallenged.

5.3

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p29, lines 11-15, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 85 p80, lines 20-24, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 86 p63, lines 7-10, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 87 p64, lines 9-12, Lord Black, ibid

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5.4

Lord Black told the Inquiry that it would be open to the regulator to decide that it wished to adjudicate more. In particular this would be helpful for the regulator when considering best practice guidelines which would tend to be informed by adjudications. Lord Black accepted that there was no principled objection to setting some sort of threshold above which cases would automatically go forward to adjudication:88 “Q. Do you think it might be better to have a sort of threshold written into the regulations which, if the regulator thought that there was prima facie evidence of a serious breach of the code or breach of the code which was other than minimum or raised minor questions of inaccuracy, then unless the complainant wished otherwise, almost as a matter of obligation, the regulator should take that forward to an adjudication? A. I would expect that to be the best practice of the regulator. If there’s a case for writing that in, if it can be codified in a way which can be written into regulations, then I wouldn’t see a principled objection to that……I would hope it would be a matter of best practice, but if there is merit in codifying it, we will.”

5.5

I think this is very important: the regulator must have a clear sense of the scale of code breaches that it is dealing with both in relation to individual publishers and in relation to the industry as a whole. This information about breaches of the code would be of critical importance to the management at the individual publishers and to the regulator in its role of promoting and maintaining standards. It is also important that mediated complaints are recorded, with code breaches identified. It is difficult to see how systemic failures in code compliance could be detected if code breaches are not identified as such by the Complaints Committee. Remedies and sanctions available for complaints

5.6

The remedies and sanctions available to the Complaints Committee are described as:89 “…a ladder of sanctions from a fairly straightforward correction through to a breach of the code that’s remedied and identified in statistics, through to a formal reprimand of the editor, right up to where there has been a very serious breach and that leads to a referral from the complaints arm to the publisher because it raises contractual disputes…”

5.7

Whilst this was presented as a change, the only thing that this proposal adds to the current armoury of the PCC is the power to refer the matter to the complaints arm. Lord Hunt did not dissent from that, saying “it’s a simple codification of it….” 90 It is notable that the regulations do not appear to give the regulator the power to determine where an adjudication or apology should be placed. Lord Black suggested that it was possible that this could be changed but that it would be a matter for the Code Committee, subject to Trust Board ratification, to change.91 I welcome Lord Black’s implication that this is an area where some movement may be seen, but it is, again, surprising that the industry has not already moved on this issue if they are inclined to do so. It is, frankly, absurd that the regulator should not have the power to determine the location of an adjudication or apology.

5.8

pp10-11, lines 13-9, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 89 pp6-7, lines 21-3, Lord Black, ibid 90 p8, line 23, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-AfternoonHearing-9-July-2012.pdf 91 pp18-19, lines 9-15, Lord Black, ibid

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5.9

Compensation The regulator is given no powers to award compensation. The explanation for this is that if compensation were available to complainants through the regulatory process it would complicate the conciliation process.92 Lord Black suggested that if the regulator were to have the power to award compensation then complainants would always tend to want the regulator to deal with their complaint rather than getting the individual publisher to deal with it; furthermore, it is likely that the publisher would be even more defensive than presently is the case. There is also another substantial difficulty. Although it might be possible to specify a right to compensation for a breach of the code that did not involve breach of the civil law (as can be awarded by Ombudsmen for maladministration), in the main the issues likely to lead to a reasonable expectation of compensation are those which give rise to a claim for civil damages. If the regulator had the power to award compensation, it is likely that it would be sought as a matter of course; instead of providing what should be speedy redress by way of apology and correction, arguments will develop about the extent of the breach and the way in which compensation should be approached. There is a real risk that lawyers for both sides would become involved, with the result that the system could collapse under its own weight. An arbitral arm could provide swift financial redress in appropriate breaches of the civil law. In the circumstances, I am inclined to agree with Lord Black that it would be better for the complaints arm not to have the power to award compensation. Limiting the sanctions available to the Complaints Committee to those set out in paragraph 5.6 does mean that, short of legal action by a complainant, a publisher is unlikely to suffer financial penalties for a single abuse, no matter how egregious it might be. However, in the event of a complaint about a particularly egregious breach of the code, it would be possible for the Complaints Committee to refer the matter to the Investigations arm, which could then, with the approval of the Trust Board, initiate an investigation. This could culminate in a fine if the single egregious breach were considered to demonstrate a complete failure of internal governance within the company.93 Contemporaneous civil proceedings The proposal does not allow for the regulator to hear a complaint if it is the subject of current legal proceedings. A joint submission from ANL, GNM and TMG points out that s114 of the Broadcasting Act 1996 prevents Ofcom from considering fairness cases where the matter is the subject of proceedings in a court of law.94 That submission argues that the nature of defamation means that it is essential that both sides in a civil case should be able to argue their case freely, and that the existence of parallel regulatory proceedings might make it difficult for the defendants to offer a full defence because of regulatory concerns. Notwithstanding that, Lord Black conceded that there was a case for allowing the regulator to look at pure code or ethics issues that are unconnected to the libel proceedings whilst those proceedings are underway.95

5.10

5.11

5.12

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p66, lines 3-13, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 93 p63, lines 16-19, Lord Black, ibid 94 p24, paras 3-4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/08/Joint-submission-from-AssociatedGNM-3-Telgraph-media-for-module-2.pdf 95 p68, lines 6-19, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf

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5.13

Lord Black further considered that there was nothing to stop the Complaints Committee considering a complaint before a libel action was brought, and went further saying that he would expect the new regulator to take the view that this could happen.96 Lord Black also expressed the view that a successful court action might “almost be an automatic trigger for a full scale investigation,” 97 thus ensuring that the regulator would look at the standards implications of successful civil action against a publisher. I remain to be convinced that there is any particularly unique problem associated with defamation that makes it impossible for court and regulatory action to be taken simultaneously. It seems reasonable that a court should be able to stay the regulatory action if continuing it would endanger the civil action, but that is no reason for a blanket ban on the regulator considering regulatory issues without waiting for any legal action to be completed first. I very much agree with Lord Black that a new regulator should take the view that a complainant can bring a complaint prior to taking legal action if they so wish, and I would consider that it should be made clear in the contract and regulations that this is the case.

5.14

Investigations
5.15 An investigation can be triggered by a number of events, described as “serious or systemic breaches”. It is accepted that this could include one serious breach where it was clear that the breach had arisen because controls were not in place in the newsroom to prevent it.98 Process 5.16 An investigations panel, once established, would have the power to view documents and, in theory, to summon witnesses. It was accepted, however, that, whilst the power to view documents could be enforced through the courts, the power to call witnesses would not be enforceable,99 although failure on the part of a publisher to provide a witness once called for would constitute a breach of an obligation.100 The investigation procedure is set out in some detail, requiring a substantial amount of oversight by the Trust Board and offering a number of opportunities for the investigated party to make representations or appeal. First, the investigation can only be established by the Trust Board.101 The regulated entity has an opportunity to make representations that the investigation should not be set up.102 If a dispute arises between the Head of Standards and the regulated entity it must be referred to the Trust Board.103 Any requirement to bring legal proceedings to compel production of documents must be approved by the Trust Board.104 Once a report has been prepared in draft it must be sent to the regulated entity, which has 28 days to make submissions.105 The regulated entity is then invited to the meeting of the investigation panel to discuss the draft report in order to be able to make further representations.106 The

5.17

p69, lines 5-19, ibid p69, lines 15-23, Lord Black, ibid 98 p48, lines 13-21, Lord Black, ibid 99 pp84-85, lines 16-2, Lord Black, ibid 100 p85, lines 3-10, Lord Black, ibid 101 p5, para 25-26, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-BrentwoodAnnex-C1.pdf 102 pp5-6, para 27, ibid 103 p6, para 32, ibid 104 p7, para 33, ibid 105 p7, para 34, ibid 106 p7, para 36, ibid
97

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preliminary decision of the panel must be sent to the regulated entity, which then has 14 days to make comments.107 Once the investigation panel has made its final decision, having had the benefit of all these submissions, the regulated entity can appeal to the Trust Board for a new panel to be set up to look at the matter again.108 The regulated entity then similarly has the opportunity to make representations to the review panel preliminary findings.109 5.18 There can be no objection to procedural fairness, and it is right that the subject of an investigation should have an appropriate opportunity to make their case and to ensure fair treatment. However, the process described above appears somewhat extreme and could be thought to give so many opportunities to the regulated entity to challenge every single step so as to frustrate the investigation and make it very difficult for the regulator to reach a conclusion, particularly if that conclusion was adverse. Lord Black defended the process, arguing that:110 “I don’t think it can be overstated quite how serious an adverse finding from the standards and compliance panel of the new regulator would be, and therefore I think the regulated entity needs to be dealt with fairly and proportionately and that means they should have the ability to put their case at certain points during this. That would just seem to me to be natural equity and natural justice.” 5.19 He went on to say:111 “I think it highly unlikely that during the course of an investigation a regulated entity would take every single opportunity to try to derail it, but even if it did, then the trust board and the investigation and compliance panel must plough on and it will get to the right place in the end.” 5.20 I am not sure that this is acceptable. These provisions have obviously been drafted to take into account the anxieties of the publishers about the implications of an investigation and I do, of course, recognise the need for them to have a full say in the process. However, if there is to be any value in the investigations process, which is itself the only genuinely new part of this proposal from the industry, then it is essential that it should be capable of operating without continually being frustrated by those subject to regulation. I do not have a particular view on what is the right number of opportunities for an investigated party to appeal against the process but I am clear that, as currently drafted, it goes too far in that direction with the serious risk of entirely undermining that effectiveness of the investigation remit of the regulator. I note that the investigations process is entirely between the regulator and the publisher. There is no role at all for the victim, or victims, of the behaviour that has given rise to the investigation. There is no opportunity for them to submit evidence to the investigation, and no opportunity for them to challenge the outcome of the investigation. I recognise that if an investigation is looking at systemic failures of governance it may not be easy to identify the victims. There is no reason, though, why this should prevent the investigations process allowing a role for victims (or, at the very least an obligation on the part of the standards investigator to consult the victim) where an investigation relates to one or more specific events in relation to which victims can be identified.

5.21

107 108

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p8, para 40, ibid p8, para 44, ibid 109 p9, para 51, ibid 110 pp33-34, lines 17-1, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 111 p34, lines 16-21, Lord Black, ibid

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Fines and Sanctions Guidance 5.22 The regulator has the power to impose fines and sanctions, but this must be done in accordance with the Fines and Sanctions Guidance issued by the IFB.112 Whist it is entirely reasonable to have fines and sanctions guidance, I am completely at a loss as to why that guidance should be set by the industry rather than by the regulator. Lord Black did not provide any insight into this, but pointed out that once the guidance had been incorporated into the contract the IFB would have no power to amend it.113 This is a minor point, but is indicative of the extent to which the industry has kept to itself control of the tools that the regulator has.

Enforcement
5.23 As a result of the contractual nature of the proposal, the regulator has only one method of enforcement of its decisions, whether in relation to a complaint or an investigation, which is to take action in the courts for an order for performance of the contract. There are a number of implications to this. The first, and most obvious, is the cost that the regulator would incur in seeking to get his decisions enforced. There will always be a matter of judgment for the regulator as to whether it is a good use of his resources (both in time and money) to take proceedings. It also means that, even where a regulatory decision has been taken according to the Regulations and all possible appeal routes have been exhausted, the publisher will still be able to argue as to whether the fine or other decision can be properly enforced under the contract.114 This adds a layer of expense and complexity to the regulator’s enforcement processes. It is argued, rightly, that if a publisher were to fail to comply with reasonable requests from the regulator, or with regulatory decisions, that this could lead to the opening of a full scale investigation. However, the same concerns apply to the enforcement of the outcome, or indeed the conduct, of any investigation. There is a risk that the proposed system could be frustrated by a publisher who, although having joined the system, was not inclined to cooperate and who could appeal every decision and argue every point, with the risk that the regulator would either have to devote a substantial amount of his resources to dealing with the problem or abandon the attempt to enforce decisions. This strikes me as a structural flaw in the proposal, although I do not immediately see a way around it. A body which derived its authority from statute or by reason of statutory underpinning would similarly be open to challenge on every decision and might similarly face a concerted effort to frustrate its ability to make and enforce decisions. The contractual system does, however, provide an extra level of potential challenge that would not be available in a system, independently appointed, which derived a measure of authority by law. A further point also arises, which is about the willingness of the regulator to take any action in court to enforce the contract. Any decision to take action against a member to compel disclosure of documents must be approved by the Trust Board, and it seems likely that any decision with the reputational, operational and financial implications of taking legal action against a member would generally be referred to the Board.115 I have already referred to Lord Black’s assertion that the complaints arm and the standards investigation arm are structurally shielded from the industry funding body. This is certainly true in terms of direct appointments

5.24

5.25

112

p3, para 5.1.4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-B1. pdf 113 p111, lines 1-8, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 114 pp83-84, lines 6-15, Lord Black, ibid 115 p7, para 33, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Lord-Black-of-Brentwood-Annex-C1.pdf

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and day to day operation but the argument wears thin in relation to enforcement if the decision to enforce a judgment of the regulator sits with the Trust Board. This could be avoided by giving the Head of Complaints and the Head of Standards the power to take action against member companies, for enforcement purposes, without reference to the Trust Board, but it is hard to reconcile that with the Board’s overall responsibility for the regulator and, in particular, its budgetary responsibilities.

6. Cost
6.1 The estimated cost of the proposal is £2.25m per annum, with a separate enforcement fund plus set-up costs.116 The cost of the PCC has been in the region of £1.75-£1.95m per annum in recent years.117 The proposal is that the industry would pay the full cost of the new system, as they currently pay the full cost of the PCC. This was presented by Lord Back as an essential aspect of a self-regulatory system and a demonstration of the industry’s commitment to standards:118 “The industry invests in the regulatory system as a sign of its commitment to protecting the public and putting right things which have gone wrong.” 6.2 It was made clear by a number of witnesses that one of the keys to any independent regulatory system was the independence of its funding. Ofcom recommended that any system should be based on fixed long term (three or four year) funding agreements which, once fixed, could not then be influenced by the funding body. Others have emphasised the need for funding to be sufficient to enable the regulator to carry out its duties effectively. I have dealt elsewhere with criticisms that although the PCC was funded adequately to operate the complaints and mediation service, that funding was sufficiently limited to prevent them from exploring other powers, such as powers to investigate, which theoretically were open to them. Lord Black’s model seeks to address both points.

Adequacy of funding
6.3 The body described in the proposal includes the Trust Board, a Complaints Committee and the associated complaints arm, with a full time staff, an Independent Assessor, a Head of Standards and Compliance, with a small full time team, and a panel of experts from whom investigations panels can be drawn. The Board, the complaints arm and the Assessor will be funded from the main budget of £2.25m. This is a larger body than the PCC because, under the PCC model, the Board and the Complaints Committee are the same body. Investigations undertaken by investigations panel will be funded from the separate enforcement fund. It is not clear whether the full time administrative staff in the standards and compliance arm will be funded from the main budget or from the enforcement fund. If the full time staff is to be funded from the main budget this is an expense not currently incurred under the PCC model.

116

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p45, para 94, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 117 PressBof Annual Reports 1990-2010, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/02/Appendix-C.pdf 118 p20, para 26, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf

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The enforcement fund
6.4 The enforcement fund is set to start at £100,000,119 thereafter being supplemented by any fines, or contributions to investigation costs, that are levied. If the permanent standards and investigations staff were to be funded from this £100,000 it is hard to see how there would be any capacity at all for ad hoc investigations; this would effectively render the standards arm irrelevant. I therefore conclude that the permanent staff will be funded from the main budget, with the enforcement fund being held in reserve to pay for investigations when the need arises. It is suggested that, with the addition of fines and cost contributions, the size of the enforcement fund might rise to £500,000. Given that cost contributions can only at best replenish what has been spent on an investigation, this must mean that there is an expectation that fines will be levied. It is not clear what is to happen to the enforcement fund should early investigations not result in any fines, for it is obviously quite wrong for decisions to be made about financial penalties based on the needs of the regulator rather than the gravity of the behaviour of the regulated entity. It is worth recalling that cooperation with an investigation is expected to be enforced as a contractual obligation through the courts if necessary. The enforcement fund would be exhausted quickly should there be the need for any such enforcement action; there is a risk that this could be exploited by a publisher who might adopt an attitude, not unknown in litigation, of fighting every single decision and appealing every decision until the other party runs out of money. Lord Black took the optimistic view that:120 “I would hope that in a system into which publishers voluntarily entered into a contract that they wouldn’t do that.” 6.6 This is only a partial answer. Publishers may voluntarily enter into this agreement because of the fear of what might happen otherwise, but the fact that these changes have explicitly only been offered because of the threat posed by the Inquiry indicates that the proposal presented is not one born of conviction but of expediency. These are not changes that the industry was eager to make and, consequently, the idea that publishers will cooperate with investigations because they join the system voluntarily rings rather hollow. It is not inconceivable that some would join the system voluntarily because they can see the weaknesses in the system that would allow them to frustrate its effective operation. When these points were put to him Lord Black effectively agreed:121 “That may well be the case. I think we’ve tried in the best way we can to make sure that the trust board has the powers and the money available to enforce the contract. I think it’s always going to be an issue to do with the nature of contract. If one party wants to grind everybody down with legal action, that is going to happen, but in any structure of law that’s going to be the case.” 6.8 The concept of providing a ring-fenced enforcement budget is a good one, but in order to be effective it must be enough to allow the regulator to be able to undertake investigations even where the publisher concerned might not cooperate. A regulator who cannot afford to take enforcement action will lose credibility with both the industry and the public. I am not

6.5

6.7

119

p45, para 93, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 120 p103, lines 1-8, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 121 pp103-104, lines 22-4, Lord Black, ibid

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well placed to say what the appropriate level of an enforcement fund should be, but what is proposed has the appearance of a very limited and inflexible enforcement budget that may simply be wholly inadequate to do the job in hand, with no obvious mechanism for addressing such difficulties if they arise. The operational budget 6.9 Lord Black stressed that the £2.25m figure was an estimate. He suggested that the new complaints arm would be dealing with far fewer complaints than the PCC because improved governance in newspapers would lead to fewer complaints, and more of those complaints that are raised would be dealt with successfully by the publisher rather than the regulator.122 Against that I set the larger administrative role, with the need to support the Trust Board and a full time standards and compliance team in addition to the current PCC structure, and Lord Black’s assertions, reflected above, that the new regulator might move to adjudicate a higher proportion of complaints in order to ensure that a breach of standards was properly recognised and properly dealt with. Lord Black said that if there were a need for more funding then the industry would have to sit down with the new regulator and look at how much the elements of the new system would cost. He said:123 “I have no doubt that sufficient funding will be made available to the regulator to fulfil its function.” I cannot be so sanguine. Lord Black acknowledged that the level of funding to be made available to the regulator was solely in the hands of the industry. The requirement to pay will be in the contract that publishers sign with the regulatory body, but the amounts that they pay will be fixed by the IFB. There are no requirements on the IFB to meet the needs of the regulator, who will have to make do with whatever is provided by the IFB. Again, my concern is not specifically about the level of funding estimated to be required for the core operations of the regulator, but about the absence of any power on the part of the regulator to set the funding levels required.

6.10

Independence of funding
6.11 This brings me to the most significant issue in relation to funding. Publishers will sign contracts with the regulator that bind them into the system for five years, and those contracts will require them to pay the fees set by the IFB. So far, so good. However, Lord Black was clear that this commitment was to the principle of funding, not to any particular amount:124 “I can’t give you guarantees over a five-year period. The industry might face a complete economic collapse in that time. What we are doing is making a commit through contracts to provide funding over a five-year period. I think it unlikely that we would be able to actually build exact figure into that contract because of course, the needs of the regulator may change over time.”

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pp72-73, lines 17-1,Lord Black, ibid p73, lines 2-7, Lord Black, ibid 124 p76, lines 9-16, Lord Black, ibid

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6.12

The effect of this proposal, therefore, is that the IFB will set the budget for the regulator on a year by year basis. This has practical implications for the regulator, which may not be able to plan its operations effectively on a long term basis, but much more significantly it has implications for the independence of the regulator. The IFB is comprised of representatives of the industry that the regulator is regulating. It is easy to see how a regulator which is dependent for the next year’s funding on the goodwill of its regulated bodies might be expected to operate with a light touch, and to seek to avoid conflict – particularly with those publishers who have the most influence on the IFB. I noted earlier that the composition and appointment processes of the IFB remain entirely opaque, so the public will never even know who wields that influence and, therefore, who the regulator is most likely to want to propitiate. This direct relationship between major publishers and the core decisions over funding of the regulator is possibly the single biggest problem with the proposal that Lord Black has presented. There are, of course, ways in which it could be ameliorated. A system which envisaged a fixed budget for the full five year term would significantly address the concerns about the continual need for the regulator to appease his funders. A system which required the budgets to be set by negotiation between the regulator and the IFB would give the regulator more power to articulate, and fight for, the resources he needs to do an effective job and to make it clear to the public if this need was not being met.

6.13

6.14

Transparency of funding
6.15 A final point on funding is the extent to which it is apparent who is funding the regulatory body. The funding of the PCC is shared between national newspapers (59.1%), regional and Scottish newspapers (34.4%) and magazines (6.5%).125 However, due to what is described as ‘trade association politics’, Lord Black was unable to tell the Inquiry how the national newspaper share of the funding is made up.126 He indicated that there might be greater transparency on this issue in the future, but was not able to give any guarantees.127 This is a matter for concern and I would urge those responsible to resolve the matter so that there is full transparency over the funding of any self regulatory body.

6.16

7. Response of editors and proprietors to the PCC and PressBoF proposals
To what extent is the industry ready to sign up to these proposals?
7.1 The Inquiry sought evidence from those editors who had previously given evidence as to the extent to which they were ready and willing, on behalf of their titles, to sign up to the proposals presented by Lord Black.

125

p2, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/10/Fourth-Witness-Statement-of-LordBlack.pdf 126 pp91-92, lines 23-2, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 127 pp92-93, lines 4-6, Lord Black, ibid

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Views from national newspapers 7.2 7.3 Some of the national titles have indicated a firm readiness to sign up to the proposal, specifically the Telegraph Media Group,128 Trinity Mirror129 and Associated News.130 Lionel Barber, editor of the Financial Times, expressed a willingess in principle to join the scheme, but warned that his view of the proposals might change as the details evolved:131 “I am happy to state that in broad terms I am supportive of the proposals and if the discussions to finalise them continue as they have to date, then I would anticipate recommending to the FTL board that FTL becomes a signatory to the contract. I would add that Lord Black’s system appears to preserve the largely useful and effective service of complaints handling and mediation currently carried out by the PCC. It is important to note that Lord Black has made clear that the proposals as submitted to the Inquiry remain a draft that is subject to industry comment and which may also need to evolve dependent on the recommendations in the Inquiry’s final report. As such my view of the proposals may change depending on any changes made to them in the course of future consultation. As you might expect, there is certainly some devil in the detail to be worked out before the contract is ready for signature.” 7.4 Within News International there was support for the principles underpinning the proposal but still, according to the editor of The Sunday Times, a need to sort out details:132 “I am ready to commit to the broad principles of the new contractual obligations though, of course, the final authorisation by News International will be made by the News International CEO in consultation with all three Editors. Whilst there are a number of details about the proposal that have yet to be worked out, I am hopeful that all industry participants will be able to reach final agreement.” “I am in principle in favour of the proposal to bind participating members of a new press body by contracts.” 133 “The Sunday Times is ready to recommend in principle that the regulated entity (Times Newspapers Limited) enter into these contractual obligations…..There is some finessing in the detail of the framework proposals still to be done which I would hope can be achieved by discussion between participants.” 134 They were not able to indicate readiness to sign contracts now.

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p2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-statement-of-Tony-Gallaghersigned-.pdf 129 p3, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-LloydEmbley.pdf 130 pp3-4, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/08/Fourth-witness-Statement-of-PaulDacre.pdf 131 p4, paras 12-13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-ofLionel-Barber.pdf 132 p2, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-DominicMohan1.pdf 133 p1, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/08/Third-Witness-Statement-of-JohnWitherow3.pdf 134 pp1-3, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-JamesHarding.pdf

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7.5

Alan Rusbridger, editor of the Guardian, indicated that, if Lord Black’s proposal was adopted after the Inquiry, the Guardian would be prepared to sign up to such a contract, subject to negotiation.135 However, he was clear that the proposal did not have his unqualified support:136 “…we believe that improvements are needed including ending the role of an industry funding body and strengthening the carrots and sticks for participation in a voluntary system. Above all we believe that a more ambitious system is required as part of a new settlement between the press and society that reflects the needs of both in today’s world. Significantly, that would include a system of alternative dispute resolution that better serves complainants and publishers: strengthened protection for public interest journalism so that the new framework encourages the best in journalism rather than merely protecting against the worst; and improvements to the media plurality framework which is not a separate issue, but lies at the very heart of the culture, practice and ethics of the press.”

7.6

Chris Blackhurst, editor of The Independent, said that he was broadly supportive of Lord Black’s proposals, in particular in relation to the contractual basis for the relationship with the regulator and the regulator’s investigative and fining powers.137 However, he went on to outline three key issues on which the group would need to see more detail before being able to commit to enter into the new system. First, that the system proposed might not be sufficiently compelling to persuade all publishers into it, and that:138 “…without the complete support of at least the major publishers, the new system may not have sufficient credibility in the eyes of the public and will be hamstrung from the outset.” Second, Mr Blackhurst raised a question about the appropriateness of the maximum fine proposed and the levels at which fines were likely to be levied, and finally, he expressed concern about whether the proposed budget of £2.25m was realistic and what the actual costs might be.139

7.7

By contrast, Northern and Shell were clear that they were not yet willing to sign up to the scheme; they had specific concerns about the proposal. The editors of The Daily Star, The Daily Express, The Sunday Express and The Daily Star Sunday all expressed reservations about aspects of the proposals:140 “The Daily Star Newspaper is not ready or committed to sign up to the Proposals in their current form and in any event, this commitment can only be made at board level. Certainly any decision to sign up to a contact under which there is the potential for incurring fines of up to £1,000,000 is a decision which would be taken by the board of the Company.

135

pp3-4, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-AlanRusbridger.pdf 136 p3, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-AlanRusbridger.pdf 137 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-from-Chris-Blackhurst.pdf 138 p2, para a, ibid 139 p2, paras b-c, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-from-Chris-Blackhurst. pdf 140 p3, paras 4-6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-ofDawn-Nessom.pdf

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In addition, I personally have concerns in respect of who will be selected to run the new regulatory body, how the decision will be made as to who runs it, and how decisions are made more generally in terms of how the body will be funded.” And:141 “At present, and with the Proposals in their current form, I would not be able to recommend to the Board that The Daily Star Sunday sign up to these contractual obligations contained in the Proposal for, among others, the following reasons: The proposals appear to take a ‘one size fits all’ approach to the contractual obligations to which we would be expected to adhere. I do not think that this would be in the best interests of the Group titles, other national and regional newspaper titles and the public. Indeed, I would go so far as to say that I consider the proposals as drafted do not appear to represent equally the interests of those in the industry; The proposed contract and its associated penalties are too draconian. The contract could damage the commercial prospects and the very future of many titles that are bound by it. For example there is no redress if a publisher believes the regulator is behaving ill an inappropriate manner. The Proposals do not appear to address any potential wrong doing for which there is not a ready adequate protection in place under the law; The proposals includes(sic) provision for the regulator to decide to carry out an investigation and impose a sanction even after civil and/or criminal proceedings have taken place, irrespective of whether any such proceedings result in the Newspaper being found liable and/or guilty. This list is illustrative of my concerns and is not to be considered exhaustive.” 7.8 Similarly, Ian Hislop, editor of Private Eye, which is not currently a member of the PCC, said:142 “Private Eye is not “at present fully ready and committed” to enter into these contractual obligations.” He explained that, whilst he did regard the proposal as a “significant improvement” on the PCC, his concerns with the proposal centred around the importance of independence and impartiality of any panel or committee involved in decisions on complaints. He further identified that none of the incentives proposed by Lord Black for membership of the new regulatory body would, in fact, provide any incentive to Private Eye.143 Views from the Scottish, Welsh and regional press 7.9 Moving away from the UK national titles there is clearly much more work to be done before publishers are ready to sign up to the scheme. None of the Scottish, Irish, Welsh or regional titles who gave evidence to the Inquiry said that they were ready to sign up to the PressBoF proposal in its current form, though they all supported the broad principles upon which it is based. For example, Ian Stewart, editor of the Scotsman, said:144

141

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p3, paras 9-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-ofGareth-Morgan.pdf 142 p3, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-Ian-Hislop1.pdf 143 pp4-5, paras 9.1-9.5, ibid 144 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-statement-of-Ian-Stewart1.pdf

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“I agree with the general thrust of Lord Black’s proposal, though I have reservations with regard to its likely cost and the bureaucratic burden it could impose. Nevertheless, bearing in mind JP’s commitment to the PCC and its Code, I am confident that the company will continue to support the principle of self regulation, though whether it will support all aspects of Lord Black’s proposals I do not know.” 7.10 A number of regional titles raised concerns about the cost, bureaucracy and other details of Lord Black’s proposals, generally pointing out that there was a need for more clarity and more negotiation. For example, Anne Pickles, Associate Editor of Cumbrian News said:145 “so far as I am able to do so, I’d suggest CN would not immediately be ready to commit to all the specifics of Lord Black’s proposals for self-regulation. That’s not to say they are dismissed as wholly inappropriate or unworkable. But they do beg more time for careful consideration and perhaps some amendment.” Jonathan Russell, editor of the Glasgow Herald, was very supportive in principle but raised a number of concerns that would need to be resolved:146 “As an editor, I believe the publications for which I have responsibility are ready and committed in principle to entering into these contractual obligations, subject to clarification of certain detail and any conclusions the Leveson Inquiry itself may reach. I also believe my view broadly reflects the attitude of Newsquest Media Group as a whole.” And:147 “However, I do not see the system as fully developed in Lord Black’s proposals and I do think there will be the need for some mechanical adjustments here and there. On my reading of it, the framework leaves the Regulator to decide whether and what changes should be made, and then the Industry Funding Body has to approve them. It puts the publishers, locked into the endless contract, at the Regulator’s mercy if the system does not work smoothly from day one. In reality, I expect the Regulator will be sensitive to concerns of this kind and will listen to us. But I have to note the lack of an express provision for the members themselves to propose changes without actually having to terminate or threaten to terminate the contract: a safety-valve, if you like. There is also a concern over the extra workload which may be placed on the senior member of staff tasked with dealing with PCC issues. This cannot become more onerous than it currently is. On the other hand, I appreciate that the public need to see a strong Regulator in place, serving a set of established principles and who is not at the beck and call of the members. I think editors like myself have to accept that this is a leap of faith we have to make in order to win back the trust of the public.” 7.11 Lord Black did not seek to consult with those blogs currently outside of the PCC so it is no surprise that Paul Staines (Guido Fawkes) and Camilla Wright (Popbitch) indicated that they were not ready to join the system. Nonetheless, Ms Wright’s assessment of the proposal offers some relevant insights into whether such a system would be likely to be welcomed by the new internet providers such as Popbitch:148

145

pp1-2, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-statement-of-Anne-Pickles. pdf 146 p1, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-JonathanRussell-of-the-Glasgow-Herald.pdf 147 p1, para 4, ibid 148 p1, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Response-from-Camilla-Wright-toModule-4-questions.pdf

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“The proposal set out by Lord Black is undoubtedly a well-meaning attempt to provide a basis under which the major newspaper publishers, who have seemingly on occasions ignored the already established PCC code when it suited (thus creating the culture, practices and ethics for which this Inquiry was established to investigate), might be persuaded to follow their own code. As such, the proposal appears to be written by and for the vested interests of the newspaper business. It appears to have almost no relevance to editors of independent web publishers such as myself. Being asked, as an obvious outsider to the national newspaper industry, to sign up to a contract whose architects and principal beneficiaries were the same media bosses in this gentleman’s club, undoubtedly has limited appeal. The composition of the trust board and complaints committee would appear to be drawn from, and relevant to, national newspapers rather than digital media.”

What difference would these proposals make?
7.12 The Inquiry also sought the views of editors on what specific differences membership of a system of the kind set out by Lord Black, underpinned by contractual obligations, would make to the culture, practices and ethics of their publications. The responses are informative. Among the national titles, only James Harding149 and John Witherow150 from The Times and The Sunday Times, Chris Blackhurst151 from The Independent and Lloyd Embley152 from Trinity Mirror, indicated that procedural changes would be required. Not a single editor indicated that the changes would have the effect of raising standards in respect of their own publication and most said that there would be no practical effect whatsoever: “In my first witness statement, I explained the basis upon which The Daily Express operates. In light of those matters, I do not think that joining a system such as that described in the Proposals would make any significant difference to how The Daily Express is run.” 153 “I would not expect that membership of a system based on contractual obligations would have a material impact on the running of the Daily Star newspaper.” 154 “As the editor of The Daily Telegraph, while there will be new requirements placed upon us, I do not envisage that the existence of a new self-regulatory system will have much practical impact upon the publication.” 155 “I would anticipate generally that there would be a continuation of the changes to the culture, practices and ethics that have been occurring at newspapers over the past five to six years.” 156
149

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p3, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-JamesHarding.pdf 150 p1, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/08/Third-Witness-Statement-of-JohnWitherow3.pdf 151 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-from-Chris-Blackhurst.pdf 152 pp3-4, paras 9-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-ofLloyd-Embley.pdf 153 p4, para 12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-of-HughWhittow.pdf 154 para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-of-Dawn-Nessom. pdf 155 P3, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-statement-of-Tony-Gallaghersigned-.pdf 156 pp3-4, paras 9-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-ofLloyd-Embley.pdf

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Consequently, we do not consider that the culture, practice and ethics of our journalism would be significantly altered by membership of the kind of system proposed by Lord Black.” 157 “We do not foresee membership of this system altering our approach to any great extent, That said, we would work with the new regulator to ensure that our approach is entirely aligned with their standards and processes” 158 “Lord Black’s proposals complement new governance that News International has already introduced.” 159 “I do not therefore believe that Lord Black’s proposals, if implemented, will have any effect whatsoever on the quality of the FT’s journalism or the culture of the FT’s newsroom.” 160 7.13 The message was essentially the same from the editors of the non-national press and magazines who provided evidence on this question: “If JP were to agree to Lord Black’s proposals, I am confident that compliance with them would make little practical difference to the way my staff and I operate.” 161 “Membership of a system of the kind set out by Lord Black, underpinned by contractual obligations, would do little - if anything - to alter the culture, practices and ethics of Cumbrian Newspapers.” 162 “If it were to be implemented, we do not consider that the system envisaged by Lord Black will have any effect at all on the current culture, practices and ethics of our respective newspapers.” 163 “In terms of the stories we carry and the way we go about our work, Lord Black’s proposals would make little difference to us…..” 164 “Notwithstanding the reservations I have in respect of the Proposals as they currently stand, I do not think that ’there would be any particular differences in the way OK! Magazine is run if such a system were to be introduced.” 165 7.14 Having said that, some responses did emphasise that changed processes would be required: “One clear area of change would be within our administration. All correspondence with statutory bodies, members of the public and the courts concerning complaints are carefully filed. However in honesty our systems for recording the route of decision making over particular stories would have to be improved in order to satisfy the the (sic) demands of an annual audit, I do not think this would take much.” 166
157 158

p3-4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-from-Chris-Blackhurst.pdf p4, para 10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-AlanRusbridger.pdf 159 pp3-4, para 13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-ofDominic-Mohan1.pdf 160 p7, para 24, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-of-LionelBarber.pdf 161 p2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-statement-of-Ian-Stewart1.pdf 162 p2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-statement-of-Anne-Pickles.pdf 163 p2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Terry-Hunt-Editor-ofEast-Anglian-Daily-Times1.pdf 164 pp1-2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Adrian-Faber-inresponse-to-Module-4-Questions.pdf 165 p3, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-of-Lisa-Byrne. pdf 166 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-from-Mike-Gilson-BelfastTelegraph.pdf

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“Therefore, I believe that any specific difference would be more about further strengthening the current practices at my publications, and the checks that are already in place (such as the need to verify any potentially contentious stories with at least two independent sources and to seek advice from the legal team as necessary). It is also likely to make the journalists more aware of the consequences of not complying, I believe that any such changes will only make a publication stronger.” 167 “Insofar as PressBofs submission may though require us to collect and store information on stories that we might be asked to justify at a later date, whereas currently we may have discussions about these types of stories, under PressBofs proposals we would likely have to note conversations and decisions made regarding these types of stories.” 168 “None, other than in terms of the additional paperwork required under the new regime, for example, in terms of annual returns to the regulator. The bureaucratic burden would not be an insuperable objection to participation in a new scheme. The underlying culture, practices and ethics would, most likely, remain the same.” 169 7.15 The only response that suggested that any substantive change would be required was that from Paul Staines, who runs the Guido Fawkes blog, who said:170 “It would bog us down in bureaucracy by opening a channel for politically motivated nuisance complainants. Every single article we write that voices an opinion is challenged by our readers in the comments, on Twitter and via email. If we were obliged to respond to complainants we would be overwhelmed. It is ridiculously impractical given the volume of specious complaints.” Not all blogs took the same line. Camilla Wright, editor of Popbitch, said that “it would be unlikely to have much effect.” 171 7.16 It is difficult, in the light of these comments, to conclude that the press themselves believe that the system proposed by Lord Black would drive up standards. It is true that, in all cases, it is said that there would be no impact from the proposals because the relevant title already respects the PCC standards. However, in the light of the practices that have been identified by the Inquiry this view, at least in some parts of the press, must display a degree of complacency that argues against the prospect of real change under the proposed system.

8. Summary and conclusions
8.1 The proposal put forward by Lord Black does represent a significant improvement on the PCC as currently constituted and I recognise and appreciate the efforts that he and others have gone to in order to be able to present this proposal in such detail to the Inquiry. However, this proposal does not, in its current form, meet any of the criteria that I set out in May.

167

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p6, paras 19-20, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-ofDavid-John-Brookes.pdf 168 p4, para 10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Second-witness-statement-ofTimothy-John-Gordon.pdf 169 p7, para 12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-witness-statement-of-Ian-Hislop1.pdf 170 p2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Third-Witness-statement-from-PaulStaines.pdf 171 p2, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Response-from-Camilla-Wright-toModule-4-questions.pdf

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8.2

I have repeatedly made it clear that in order to be considered effective a new regulatory regime would have to work for the public as well as for the industry. That means that, besides promoting the highest professional standards of journalism and the importance in a democratic society of free speech and freedom of expression, a new regulatory regime must cover all significant publishers; it must also be capable of raising standards while at the same time protecting both the public interest and the rights of individuals. This proposal fails to meet the requirement for effectiveness on two of those points. First, the proposed contractual basis has some benefit in keeping publishers within the system for a period of time once they have signed up. However, it does nothing to require them to sign up and the evidence before the Inquiry makes it clear that there is a substantial distance to go before all significant publishers could be persuaded to join the system. In those circumstances it is not possible to say with any confidence that this proposal would have sufficient coverage within the industry. Furthermore, I realistically have to identify that the main incentive to any publisher to sign up to this system is the threat that the Inquiry will recommend some form of regulation that is less to their taste. Once this Report has been published, that power to bring publishers to the table will no longer exist, so to the extent that publishers have not yet signed contracts there can be no reliance on them ever doing so. Even if all significant publishers were to join this proposed contractual system there is no guarantee that the system would continue to operate, or to operate at the standards currently proposed, beyond the first five year period. In addition, titles may leave the system if ownership is transferred to a non-member. This does not provide sufficient long term stability or durability. A number of incentives have been proposed to entice publishers into the system and to keep them there. Unfortunately those incentives are very weak and it is difficult to see them having any impact on a publisher who does not in any case consider membership to be in his interest. Second, the proposal is structured entirely around the interests and rights of the press, with no explicit recognition of the rights of individuals. The system gives no rights at all to complainants and the regulator is set up without any remit to protect the rights of third parties. At its heart, an effective regulator should have the interests of those likely to be affected, alongside the interests of freedom of expression and the freedom of the press. A new system must have an independent process for setting fair and objective standards. In my opinion, this proposal fails to meet that test by leaving the setting of standards in the hands of the industry, albeit with a check by the Trust Board. A relatively small change to the proposal, making it clear that the Code Committee is advisory and that the Trust Board is responsible for establishing and altering the code, would go a considerable way to deal with this concern. A new system must have an independent enforcement and compliance mechanism. This proposal makes real advances under this heading. I welcome the emphasis on improving internal governance within publishers. I support the proposal that complaints should be dealt with in the first instance by publishers. I endorse both the requirement for an annual return on compliance to the regulatory body and a named senior individual within each title with responsibility for compliance and standards. These are real innovations and are very welcome. However, the proposal still has serving editors on the body making decisions on complaints and this does not provide the required degree of independence of enforcement.

8.3

8.4

8.5

8.6

8.7

8.8

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8.9

I welcome the proposal for a standards and compliance arm, with both its ongoing monitoring role and its ability to carry out investigations. Again, these are both real innovations and are much needed. However, there are substantive concerns about the ability of this part of the organisation to function effectively given the procedural arrangements proposed. I am sure that this could be resolved by addressing the procedural issues, but they are not insignificant and it would be important to have an independent review of the operation of the standards arm after a short period, say a year, to ensure that they had been addressed effectively and to consider the possibility of making further procedural changes if they were needed. Overall, however, I have serious reservations about the independence of the appointment process for the Chair of the Trust, and about the role of the Industry Funding Body throughout this model. I believe that sufficient independence cannot be achieved while the industry has a veto on the appointment of the Chair, has the right to define the standards and has the right to define the sanctions available. All these concerns could be remedied by reducing the IFB’s role in the operation of the proposal. A new system must have the ability to offer meaningful remedies of correction and apology to those who have been harmed and to apply effective sanctions to those who continue to breach standards (or fail to comply with directions as to correction and apology). The remedies offered to individuals under the proposed system are exactly the same as those currently offered by the PCC, albeit with some potential improvements in transparency. This does not seem to me to be sufficient. The regulator should have the power to determine the prominence and placing of an apology, correction or adjudication and all breaches of the code should be identified and recorded as such, even where the publisher cooperates with a mediated settlement. As has been made clear earlier, the creation of the investigations process is to be welcomed, and both the investigatory powers and the range of the sanctions available do look to be potentially effective if publishers cooperate. I repeat, however, that this process cannot be effective if it is prevented from operating by oppressive procedures; changes therefore need to be made to ensure that this does not arise, even where a publisher might try to frustrate the process. An effective regulatory system must be adequately financed and have sufficient independence from its funding body to operate independently. I have significant concerns on both those fronts in relation to this proposal. First, the sums proposed both for core funding and for the enforcement fund look tight. This is particularly the case in relation to the enforcement fund which could easily be used up on investigations into a recalcitrant publisher. Second, the role of the Industry Funding Body throughout the proposal and the fact that the funding will not be settled in advance for the full contract period, give far too much influence to the IFB. It is welcome that the industry is keen to fund this regulatory regime itself without input from the taxpayer or from complainants; however, the extent to which the largest players must shoulder the bulk of the burden of the cost for the good of the industry as a whole, along with the extent to which the funding mechanism should be open and transparent, are also issues which would have to be addressed.

8.10

8.11

8.12

8.13

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Chapter 4 Other prOpOsals submitted tO the inquiry
1. Introduction
1.1 Chapter 2 above described the proposal that has been put to the Inquiry by Lord Black, as Chairman of PressBof, on behalf of the industry. There have been some 45 other proposals for complete or partial regulatory regimes submitted to the Inquiry and many more submissions with ideas and comments on the way forward. I am very grateful to all those who have taken the time and gone to considerable trouble to offer their assistance to the Inquiry in this way. Whilst some of these proposals are complete in themselves, I intend to consider all the elements of a regulatory regime that have been put forward, rather than to describe each model as presented. All of the submissions are part of the evidential record of the Inquiry and can be seen in their entirety on the website. Rather than looking at each individual proposal for an entire answer it is more useful to look at the range of proposals made each of the issues covered, by way of building up a complete picture of the ideas that have been submitted.

2. a new regulatory body
2.1 All the proposals submitted have made two basic assumptions. First, that the Press Complaints Commission (PCC) as currently constituted is not delivering adequate regulation of press standards and, second, that some form of new regulatory body is required. The first of those assumptions is important only in that it reinforces the conclusion I have already reached1 that leaving the current system unchanged is not a credible option. The second assumption, that a new press regulatory body is required, is more interesting and requires some examination. All those submitting proposals for the future envisage the establishment of a new body with responsibilities for press standards. These proposed bodies obviously differ significantly in their scope, authority and powers, but no one has suggested that press standards could be supported adequately though changes to the general law or through strengthening law enforcement. Neither has anyone suggested that improvements in internal governance in the press would, of themselves, be sufficient guarantee of adequate standards. This does not mean that the creation of a new press standards body is the only possible answer to the problems with press standards identified in this Report. It does, however, mean that I have not received evidence on potential alternative approaches.

2.2

2.3

3. Functions and structures
3.1 A variety of functions for a new press standards body to cover have been put forward. Essentially they fall into the categories below.

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Setting standards
3.2 By ‘setting standards’ I broadly mean the establishment of a code of practice that sets the minimum standards to which relevant organisations are expected to adhere and against which their conduct should be judged. Three different approaches have been adopted to standards setting. The first is that contained in the industry proposal, namely that the setting of standards should be essentially a matter for the industry, albeit with some lay input, and that it should sit outside of any body with responsibility for enforcing the standards. This position is put forward by Lord Black and supported by all publishers or editors who have commented on the issue. It is also the position supported by Lord Prescott’s working group.2 The second proposition is that standards setting should be the responsibility of an independent regulatory body that is also responsible for enforcement of the standards. This is the position put forward by the Campaign for Press and Broadcasting Freedom (CPBF),3 the Co-ordinating Committee on Media Reform,4 Ofcom,5 the Media Regulation Round Table6 and Professor Roy Greenslade.7 The third proposition, only explicitly put forward by Max Mosley,8 is that there should be separate independent bodies which set the standards and enforce them. This would allow for statutory enforcement of press standards without the standards themselves being set by a statutory body. A joint submission on behalf of the Core Participant Victims (CPVs) argues for separate mechanisms for rule making, adjudication and investigations, but is not specific in terms of whether this means separate bodies.9

3.3

3.4

Promotion and enforcement of standards
3.5 Where the issue is addressed specifically, all the proposals submitted envisage a new press standards body having a broad regulatory role involving the promotion and enforcement of standards. This is often described as requiring investigative powers.

Complaints handling
3.6 All the proposals submitted envisage that some part of their proposed regulatory structure would have the responsibility to hear complaints about breaches of a press standards code. In most cases the proposals are not specific about the degree of relationship between the more general standards enforcement role and the complaints handling role. In the case of the industry proposal, it is quite clear that it is envisaged that both are done by the same body, albeit by different parts of that body. The British and Irish Ombudsman Association was clear

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p8, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-led-byLord-Prescott.pdf 3 p15, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/03/Submission-by-Campaign-for-Press-andBroadcasting-Freedom1.pdf 4 p11, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-CoordinatingCommittee-for-Media-Reform.pdf 5 p102, lines 1-9, Ed Richards and Colette Bowe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-12-July-2012.pdf 6 p3, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 7 p14, para 12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 8 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 9 p1, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Joint-Submission-by-Core-ParticipantVictims1.pdf

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that a true ombudsman, dealing with complaints, would be separate both from the body that set the standards and the body that enforced standards more generally (although they made no comments on whether those two roles should be separate).10

Championing freedom of expression
3.7 Some proposals explicitly recommend a role for the press standards body in acting as a champion for freedom of expression or the freedom of the press.11 The National Union of Journalists (NUJ) says that the primary duty of a new press standards body should be to ensure the freedom of the press from both the state and editors and owners.12 The Media Regulation Roundtable sets out two objectives for their proposed new Media Standards Authority, one of which is:13 “To promote and protect the right of the media to publish information on public interest matters and the right of the public to receive it by promoting and protecting public interest journalism in all its forms and by protecting and encouraging high standards of ethical and responsible journalism.”

Adjudication of civil claims
3.8 Adjudication of civil claims is considered as essential in a number of proposals. Specifically, Early Resolution, the Alternative Libel Project and Max Mosley build their proposals around the provision of dispute resolution procedures. The Early Resolution proposal suggests a statutory basis for the regulator and the adjudication process, ensuring that all relevant claims are dealt with though this means.14 Similarly, Mr Mosley proposes a structure based around a statutory tribunal with authority over all printed press, its agencies and the internet.15 By contrast the Alternative Libel Project and the Media Regulation Roundtable suggest that access to a cheap, fast and fair way of resolving defamation claims would be a strong incentive to publishers to join a voluntary regulation system.16 The CPVs argue that the regime should oversee issues covering libel, privacy and harassment (as well as broader standards concerning accuracy, publishing and information gathering) but do not present any specific proposals as to how that should be done.17

10

p10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-British-and-Irish-OmbudsmanAssociation.pdf 11 p11, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-CoordinatingCommittee-for-Media-Reform.pdf; p2 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Sumissionfrom-Jeremy-Hunt-MP.pdf 12 pp3-7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 13 p3, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 14 pp8-9, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Early-Resolution.pdf 15 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 16 p4, para 1.12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Alternative-LibelProject-English-PEN-and-Index-on-Censorship.pdf; pp3-4, para 6, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Submission-by-Media-Regulation-Round-Table.pdf 17 p2, para 7, point 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Joint-Submission-by-CoreParticipant-Victims1.pdf

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Pre-publication functions
3.9 Few of the proposals address the question of whether the press standards body should have any functions prior to publication. Early Resolution recommends that the issue of advisory ‘desist notices’, to deter actual or threatened media misconduct, is an important function.18 The Media Regulation Roundtable proposes a specific role for the media standards body of providing pre-publication advice, including being able to request a publisher to demonstrate evidence of an appropriate public interest prior to publication of material that invades an individual’s privacy.19 This approach was strongly criticised by Sir Charles Gray of Early Resolution,20 who argued that involvement of a standards body prior to publication in that way would constitute an interference with the freedom of the press.

Roles for other bodies
3.10 George Eustice MP, in his proposal, suggested additional roles for bodies other than the proposed press standards body. Specifically, he suggests that Ofcom should have a role in ensuring adequate governance within press organisations. He does not suggest that Ofcom should have any role in dealing with disputes about individual news stories,21 but does suggest a right of appeal to the Information Commissioner in respect of privacy cases. He proposes that this right to appeal should apply in respect of all media, irrespective of whether they were participants in any system of voluntary regulation.22 This is perhaps best considered in relation to the suggestions for reform of the Data Protection Act elsewhere in the Report.23 A different approach was put forward by the Media Standards Trust (MST) and the communications consultant Tim Suter. Both proposed a system based around a statutory oversight body that would have the role of approving self-regulatory bodies. Under this approach the focus is not on the functions of the self-regulatory body itself, but the minimum requirements that such a self-regulatory body should have to meet. Under the MST model the oversight body would only approve bodies that meet: (a) (b) (c) (d) 3.12 minimum commitments within a code of practice; basic requirements of a contract of membership, including sanctions; adequate independence; and adequate governance arrangements with regard to proportionality, accountability, consistence, transparency and targeting.24

3.11

Under Mr Suter’s proposal the oversight body (which in his case is the Ofcom Content Board) would have to satisfy themselves as to:25

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p12, 9.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Early-Resolution.pdf pp3-4, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 20 pp44-46, lines 22-11, Sir Charles Gray, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Afternoon-Hearing-12-July-2012.pdf 21 pp5-6, para 2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-George-Eustice-MP. pdf 22 p6, para 4, ibid 23 Part H 24 pp89-90, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-StandardsTrust.pdf 25 pp3-4, para 17, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Tim-Suter-ofPerspective-Associates.pdf
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(a) (b) (c) 3.13

governance arrangements guaranteeing independence from both Government and industry; adequate regulatory scope, industry coverage and powers; and adequate operational and funding arrangements.

The oversight body would establish basic rules around independence and effectiveness but the rest would be for the self-regulatory body, which would have at least the standards setting and complaints roles otherwise described. Under this approach the oversight body would have significant powers to determine the regulatory framework, but no regulatory powers over press organisations themselves. The effect of an oversight body withholding its approval from a self-regulatory body, or of a press organisation refusing to join an approved self-regulatory body, is a key point under these proposals and is considered later in this chapter.

3.14

4. should coverage be voluntary or mandatory?
4.1 The proposals submitted to the Inquiry are split on whether compliance with press standards that go beyond the existing criminal and civil law should be voluntary or mandatory. Those arguing that regulation or adherence to standards should be voluntary offer four reasons as to why. First, there is an argument that any form of mandatory regulation of press standards is an infringement of the freedom of the press. Lord Prescott warns that a mandatory system risks turning into, or being perceived as, a state licensing system.26 Paul Dacre said that he feared any Parliamentary involvement would be the ‘thin end of the wedge’.27 Similarly, Lord Hunt has expressed strong reservations about the risks to freedom of the press should any measure relating to regulation of the press come before Parliament.28 Lord Black argues that any form of statutory intervention would inevitably undermine the “constitutional principle” of independence.29 Ed Richards was clear that a licensing regime, such as that which Ofcom operates in respect of broadcasting, would not be an appropriate model for the press because:30 “freedom of expression works in a different way, and a more unqualified way, for the press.” The Media Regulation Roundtable asserts that compulsory regulation would have to be backed by compulsory registration and that this might be difficult to justify under Article 10(2) of the ECHR.31 Hugh Tomlinson QC said that regulation of the print media could, in some circumstances be compatible with the ECHR, particularly if limited, for example, to a set of mandatory standards for publications with a large circulation, but that general regula26

p6, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-led-byLord-Prescott.pdf 27 p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 28 p64 line 23 – p66 line 4, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/01/Transcriptof-Afternoon-Hearing-31-January-2012.pdf; pp5-7, paras 14-18, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Submission-by-Lord-Hunt-of-Wirral.pdf 29 pp11-12, lines 20-3, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf; pp13-14, para 2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Submission-by-Lord-Black-of-Brentwood1.pdf 30 pp95, lines 9-11, Ed Richards and Colette Bowe, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-12-July-2012.pdf 31 pp17-18, para 58, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-MediaRegulation-Round-Table.pdf

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tion which might amount to a licensing regime would not.32 4.2 Second, it is argued that the effectiveness of a standards regime depends on the active support of the participants, that a mandatory scheme would not have the support of those compelled to comply and consequently would not be as effective as a voluntary system could be.33 Mr Richards pointed out that for self-regulation to be effective it requires ‘genuinely willing participants’ in the enterprise. The point was also made by Ofcom that self-regulation is most likely to be effective where there is a strong alignment between the industry interest and the public interest,34 leading to the conclusion that active support could best be secured by the right range of incentives within a self-regulatory system. The Media Regulation Roundtable argued that a voluntary system would be designed to obtain the fullest cooperation of the media; as a result, it would be more likely to command support and be effective in practice.35 Third, it is argued that there are numerous practical difficulties with making a system mandatory. Any mandatory system would require some form of legislation; it is argued that this would make the resultant system inflexible and unable to move to react to changes in the market or in technology.36 As an example, Lord Black points out that the broadcasting complaints regime is governed by the Communications Act 2003, which doesn’t even mention the internet.37 Finally, issues have been raised about for whom any such regulation or standards would be mandatory. Specifically there are concerns about the ability of legislation to identify relevant online providers in a world where anyone might contribute to news and current affairs discussion online, via Twitter or blogs, alongside big news providers (including newspaper websites).38 There are obvious difficulties about seeking to apply regulation to providers of internet services that are not based in the UK.39 Equally there might be a risk of any providers moving out of the UK in order to avoid mandatory standards regulation.40 Generally, even where there is strong support for a voluntary system, those proposing such systems are keen for all news providers, particularly all national newspapers, to be part of the system. Lord Hunt said that the industry’s proposed voluntary scheme would be ‘fatally undermined’ if a big fish, such as Northern and Shell, were to escape the net.41 Accordingly, all of the proposals that rely on voluntary membership of a press standards body also stress

4.3

4.4

4.5

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p39, lines 1-13, Hugh Tomlinson QC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf 33 p13, lines 9-15, Lord Black p13/9-15, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 34 p7, para 3.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 35 p19, para 64, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 36 pp13-14, paras 39-40, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Huntof-Wirral.pdf 37 p19, para 24, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 38 p6, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-led-byLord-Prescott.pdf 39 pp18-19, paras 61-63, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-MediaRegulation-Round-Table.pdf 40 p13, lines 3-8, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 41 pp1-2, lines 14-14, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-10-July-2012.pdf; p14, para 42, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Submission-by-Lord-Hunt-of-Wirral.pdf

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the need for appropriate incentives to ensure universal membership of relevant news organisations. The range of incentives proposed is considered in more detail in below.42 4.6 By contrast, those arguing for a mandatory standards regime simply point to the failure of the voluntary self-regulatory approach over the last century and, in particular, the difficulty of ensuring that all relevant publications comply with any voluntary regime. Separate issues are also raised about the ability to require both claimants and defendants to use an alternative dispute resolution mechanism. However, whilst the rationale for making some form of standards regulation compulsory is common to a number of proposals, the concept of what might be made compulsory differs widely between them. Whether some form of mandatory standards regulation amounts to a form of licensing will depend heavily on the consequences of non-compliance. The following paragraphs briefly outline both the mandatory elements of proposals and the proposed consequences of non-compliance. The CPVs argue that all newspapers and magazines should fall within the jurisdiction of the regulatory regime and comply with the requirements of adverse adjudications or investigations.43 This appears to be an argument for compulsory coverage by implication, rather than specifically stated as such. Sir Louis Blom-Cooper QC recommends mandatory coverage for a Standards Commission that would adjudicate on complaints as well as having investigatory powers and a role to promote freedom of expression. However, the only sanction underpinning the mandatory standards would be its own publication of its critical verdicts.44 This is a proposal that enhances transparency around the standards applied by the press but would not be regulation in any usual sense. The Campaign for Press and Broadcasting Freedom (CPBF) outlines proposals for a body that would have the power to adjudicate on breaches of its code of ethics and order the wording and placement of publication of apologies and retractions. This would be enforceable by a court and the CPBF suggest that, where a publication is outside of UK jurisdiction, then distribution could be suspended until ‘the matter is resolved’.45 This approach limits the mandatory nature of regulation to the publication of apologies and retractions, but is silent on what might happen if a publication refused to comply with a direction or a court order enforcing it. In a submission on behalf of the Labour Party, Harriet Harman QC MP makes a similar suggestion, emphasising that the important element is the ability of the body to enforce its decisions across all newspapers. In Ms Harman’s model the courts would be able to fine the newspapers if they failed to comply with an order of the body.46 Mr Eustice challenges the idea that statutory regulation of any sort would have a chilling effect on freedom of expression, pointing to the substantial statutory regulation of broadcasting, whilst underlining that broadcasting is home to ‘some of the best investigative journalism in Britain’.47 The statutory provision he envisages is a role for Ofcom in overseeing governance standards in the press, with no involvement in day to day disputes on individual stories,

4.7

4.8

4.9

4.10

section 5 p2, para 7.5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Joint-Submission-by-Core-ParticipantVictims1.pdf 44 pp15-16, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/First-Submission-by-Sir-Louis-BlomCooper-QC.pdf 45 pp4-6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-The-Campaign-for-Pressand-Broadcasting-Freedom.pdf 46 pp4-5, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QCMP-on-behalf-of-the-Labour-Party1.pdf 47 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-George-Eustice-MP.pdf
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and a role for the Information Commissioner in providing redress for individuals in relation to breaches of privacy. He does not set out what the consequences might be for a press organisation which refused to comply with either element of statutory regulation.48 4.11 Early Resolution propose a system of mandatory regulation that requires media disputes that would otherwise have gone to the courts to be subject to a statutory dispute resolution scheme.49 Although not spelt out, the decisions of the dispute resolution body would be enforceable by the courts. Mr Mosley proposes a similar scheme, but with the proposed tribunal having powers to investigate and adjudicate on any breach of the rules established by an independent Press Commission. The decisions of the tribunal would be able to be appealed to the High Court and decisions of the tribunal would be enforced by the High Court.50 The NUJ proposes a statutory regulatory body with jurisdiction over all publications of a certain size and their associated websites. Various options are suggested for the size trigger. The regulatory body would have the power to impose fines for breaches of standards as well as to order the publication of corrections and apologies in respect of the publications over which it had jurisdiction.51 The NUJ does not elaborate on the consequences of failure to comply with an order of the body. Professor Greenslade concludes that there has to be some form of compulsion for the larger publishers but he would rely on a system of incentives for smaller and online publications.52 The body would adjudicate on complaints and be able to order publication of an adjudication.53 Professor Greenslade does not elaborate on what the consequences would be of a larger publisher failing to comply with an order from the body. As already mentioned, Mr Suter and the MST each propose a statutory requirement that media organisations should belong to an approved self-regulatory body. Under the MST proposal the statute would apply only to big media companies, and would require internal governance standards in individual companies and membership of an approved self regulatory body.54 Failure to do either could result in a fine enforced, if necessary, by the courts.55 The powers of the self-regulatory body in respect of breaches of standards would be a matter for the body itself; this would be by agreement with its members, as long as it could satisfy the backstop regulator that it was sufficiently robust. Under Mr Suter’s proposal there would be a general authorisation regime, which would allow anyone to publish but would require them to do so in a way which met any regulatory requirements set down. Ofcom would define the characteristics of media services that should be regulated, including with reference to the size of the undertaking. Those services falling with the definition would have to join an approved self-regulatory body. The Ofcom Content Board would then be responsible for approving self-regulatory bodies, in line with the

4.12

4.13

4.14

4.15

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pp5-6, paras 2 and 4, ibid pp8-9, paras 6.1-6.4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-EarlyResolution.pdf 50 pp3-4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 51 pp10-11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 52 pp37-38, lines 12-8, Professor Roy Greenslade, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-12-July-2012.pdf 53 pp12-14, para 10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 54 p72, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 55 p81, ibid

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regulatory outcomes set out by Ofcom.56 As with the MST proposal, the self-regulatory bodies would be free to define their own codes and sanctions, but would need to satisfy the Content Board that they had adequate governance arrangements, scope, coverage and powers in order to be approved. Any organisation falling within the characteristics defined by Ofcom but refusing to join a relevant self-regulatory body would be regulated directly by Ofcom, using the self-regulatory code considered by the Content Board to be most appropriate.57 Mr Suter does not say so in terms, but the ultimate sanction in a general authorisation regime is withdrawal of authorisation to carry out the regulated activity.

5. Incentives for membership
5.1 As described above,58 where compliance with press standards is proposed as a voluntary matter there is considerable desire to craft incentives that would encourage publishers to join a voluntary standards organisation. A number of potential incentives have been set out in the proposals submitted to the Inquiry and they are considered here.

Kitemarking
5.2 Kitemarking is the most straightforward of the incentives proposed. The issuing of a kitemark would rest solely with the regulatory body and no cooperation from outside the industry is required. A kitemark would stand as a symbol of the quality of a publication in terms of its adherence to the professional and ethical standards set out in the code of practice. The commercial value of the kitemark would be wholly dependent on the extent to which the purchasing or reading public were aware of its existence, and of what it meant, and the extent to which that affected purchasing decisions. Essentially a kitemark has no value unless a product carrying it succeeds better in the market than a competing product without it. Mr Dacre suggested that a kitemark would be effective. It would signal to the public which publications had signed up to self regulation and as such would provide an incentive not only to newspapers but also to internet news providers to join the system.59 The Media Regulation Roundtable suggested that a kitemark might be of particular value to smaller publishers and bloggers.60 Lord Hunt told the Inquiry that he thought publishers would carry a kitemark with pride. He accepted that there would always be some publications which might take equal pride in not carrying the badge and signalling themselves as outside the system, but he felt that it was important to make adherence to the new regime more visible.61 I suspect that, while a kitemark might be seen as a benefit by some publishers, it is unlikely to have a significant impact in persuading publishers who do not otherwise want to join a selfregulatory standards regime to do so.

5.3

5.4

p2, paras 8-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Tim-Suter-ofPerspective-Associates.pdf 57 p5, paras 21-22, ibid 58 paragraph 4.5 59 p7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 60 p21, para 72, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 61 pp19-21, lines 17-7, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-10-July-2012.pdf

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VAT zero-rating
5.5 An idea which was much discussed during the early months of the Inquiry was the possibility of removing the VAT zero-rating for publications that were not members of a self-regulatory scheme. Given the currency this idea gained, it has been considered in depth and it is important that that the issues are set out. The essential background is that printed material is zero-rated for VAT purposes, that is to say, no VAT is charged or payable. It is an important point that this is not an exemption from VAT. The proposition is that a newspaper that is not signed up to a self-regulatory standards regime should, instead, have VAT levied on it at the standard rate (currently 20% in the UK). John Evans, Deputy Director in the Solicitor’s Office at HM Revenues and Customs (HMRC), with responsibility for advising on legal issues relating to VAT, has provided the Inquiry with expert evidence relating to this proposal.62 He explains that VAT is a European tax, and that one of the intentions of the EU VAT Directive 2006/112/EC is to ensure that the application of VAT does not distort competition, whether at national or community level.63 VAT is a tax on the final consumer, not the business. The effect of standard rating newspapers supplied by publishers outside the self-regulatory system would, in fact, be an increase in price for the consumers, or a squeeze on profit margins for the publishers, depending on how the publisher chose to manage his pricing.64 Either would have an impact on competition; indeed, that would be the point of the proposals, since the aim is to provide a strong commercial incentive on the publisher to join the self-regulatory regime. The UK does not generally have the ability to determine which products are subject to VAT and which are not. There is no general discretion available to Member States to apply or dis-apply VAT to a particular product or service. Under the Directive, and pending full harmonisation of VAT, Member States have been permitted to, amongst other things, maintain some zerorates.65 The zero-rate applied to printed matter (including newspapers and magazines) is one of those. The UK does have discretion to remove those zero-rates and apply VAT at the standard rate to those products or services.66 However, once a zero-rate has been withdrawn it cannot be reinstated.67 All UK application of VAT must be consistent with the principle of fiscal neutrality, which precludes treating similar goods differently for VAT purposes.68 It follows that in order to implement the proposal described above, one would have to be confident that a newspaper published by a publisher within the self-regulatory regime and a newspaper published by a publisher outside the self-regulatory regime were not ‘similar goods’.69 Mr Evans drew the attention of the Inquiry to a judgment of the Court of Justice of the European Union (CJEU)70 in which the court had been very clear that different legal regimes or different systems for control and regulation were of no relevance when assessing whether or not supplies of products or services were similar.71 Mr Evans also drew the attention of the Inquiry to a

5.6

5.7

5.8

62 63

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http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/HMRC-submission-by-John-Evans.pdf p2, paras 5-6, ibid 64 p4, para 10, ibid 65 p4, paras 11-12, ibid 66 p5, para 14, ibid 67 p11, para 30, ibid 68 p7,para 18 ibid 69 para 5.5 70 The Rank Group plc (Joined Cases C 259/10 and C260/10) 71 p9, para 23, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/HMRC-submission-by-John-Evans.pdf

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further decision72 in which the CJEU had concluded that similar services could not be treated differently for VAT purposes simply because one was lawful and the other was not.73 5.9 Mr Evans told the Inquiry that, in the view of HMRC, the supply of newspapers was likely to be similar whether supplied by a member or by a non member of a self-regulating body. HMRC therefore considered that a challenge against the proposed change, either through the UK courts or by the EU commission, would be highly likely to be successful.74 It is worth bearing in mind the provision noted at above,75 that once a zero-rate has been removed from a product or service the UK has no discretion to reinstate it. It follows that if the zero-rating were to be removed from newspapers outside of the self-regulatory regime, and that distinction was found by the CJEU to be a breach of fiscal neutrality, the UK would be unable to reinstate zero-rating for those newspapers outside the self-regulatory regime and would therefore be required to withdraw the zero-rating from all newspapers in order to preserve fiscal neutrality.76 Mr Evans made a number of other points about the proposal. If the proposal were successfully adopted, the decision over whether or not VAT were charged on a newspaper would effectively reside with the self-regulatory body. However, ultimately HMRC must be able to reach its own view on whether those decisions were being reached in a fair way, and HMRC and the Government could become involved in a legal challenge to a decision of the regulatory body. This would effectively give the Government a significant backstop role in decisions of the regulator over who could join or remain a member of the system.77 There is also a risk that differential VAT treatment of newspapers inside the self-regulatory system could be considered to be a state aid. Unless such aid had been cleared in advance by the European Commission (and the likelihood of getting such clearance would require detailed consideration) the aid, in the form of the difference between the levels of VAT, would have to be paid back to HMRC by the newspaper publishers who had benefited from it.78 Mr Evans also drew the attention of the Inquiry to potential risks that the proposal could constitute a barrier to freedom of establishment under the Treaty on the Functioning of the European Union,79 and that it could constitute an infringement of the right to freedom of expression under the ECHR.80 Finally Mr Evans noted that there would be a potentially significant compliance cost for small businesses who sell newspapers, some of whom may have to register for VAT where they were not already so registered, and in being able to correctly identify which publications were subject to VAT and which were not.81 It is noticeable that very few witnesses have supported this proposal during Module Four of the Inquiry. Professor Greenslade82 and Ofcom83 float it as an idea in their submissions,

5.10

5.11

5.12

5.13

Fischer v Finanzamt Donaueschingen (Case C-283/95) p9, para 24, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/HMRC-submission-by-John-Evans.pdf 74 p10-11, para 29, ibid 75 para 5.7 76 p11, para 30, ibid 77 p12, paras 33-34, ibid 78 p12-12, para36-39, ibid 79 p13, paras 40-42, ibid 80 p14, para 43, ibid 81 p14, para 44, ibid 82 p16, para 14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 83 p19, para 4.18, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf
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but without any detailed explanations of how it might be possible. Ms Harman,84 and the Media Regulation Roundtable85 explicitly recognise that there may be insuperable barriers to this in European law. The MST looks at the issue in considerable detail and identifies that the current zero-rating of newspapers for VAT is worth nearly £400m collectively to national newspaper titles86 but recognises that, although the removal of VAT zero-rating as an incentive to join a self-regulator scheme is possible in theory, it would require considerable political will and would likely take some years to come into practice.87 I see this as a considerable understatement. The political will and the time required to overturn the principle of fiscal neutrality are, in my opinion, incalculable. Put simply, this is not a credible option.

Journalistic accreditation
5.14 Mr Dacre first raised the possibility that the provision of press cards to journalists could be restricted only to journalists working for publishers subscribing to the new regulatory body.88 This proposal is one of the four potential incentives to membership of the industry proposal put forward by Lord Black, and is explained in basic terms in Chapter 3 above. The proposal has now been rejected by the UK Press Card Authority (UKPCA).

Access to industry services
5.15 There are a number of services, where the newspaper publishing industry works together, which, it has been suggested, could be withheld from those who do not join a self-regulatory press standards body. The first is access to Press Association (PA) copy. The PA is a private company, with 27 shareholders, most of whom are national and regional newspaper publishers.89 It is the main multimedia news agency in the UK and Ireland, providing newspapers with access to its news content, as well as images, listings, sport and weather information.90 The proposal is that access to PA copy might be denied, or at least supplied on differential terms, to publishers who refuse to comply with a code of practice.91 Newspapers, both regionally and nationally rely heavily on PA wire copy for content. It is a fundamental resource, particularly with current business models, and a newspaper denied access to PA services would have to find an alternative source for such material, such as producing its own foreign and national news content, or do without such information.92 Mr Dacre argues that denying access to news publishers to the PA service would be a ‘crushing blow’.93 The MST agrees that this would have a significant impact on publishers outside the system, but argues that restricting it would be undesirable because of its impact on the market.94 The second industry service it has been suggested could be denied to those outside a selfregulatory system is coverage within the Audit Bureau of Circulations (ABC) and the National

5.16

5.17
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p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf 85 p21, para 73, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 86 p52, table 3.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-StandardsTrust.pdf 87 p54, ibid 88 p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 89 http://www.pressassociation.com/about-us/shareholders.html 90 p55, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 91 p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 92 p56, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 93 p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 94 p56, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf

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Readership Survey. At present, ABC provides a vast range of media organisations, advertisers, academics and public members with data on circulation and web traffic. The data provided is used by the media owners and advertisers to calculate the value of advertising space. The ABC Board consists of members nominated by the trade bodies of both media owners (the NPA, the PPA, NS) and the advertising industry (Institute of Practitioners in Advertising (IPA) and the Incorporated Society of British Advertisers (ISBA)).95 Whilst ABC is the dominant provider of this data, it is open to publishers to find other sources. The National Readership Survey is governed by the IPA, the NPA and the PPA and provides data for the size and nature of the audience reached in relation to over 250 newspapers and magazines.96 5.18 Professor Greenslade suggests that this would deny such publishers the ‘currency’ that advertisers use to buy space,97 thus having a potentially significant economic impact on them. The MST says that, whilst denial of access to both ABC and NRS figures would be likely to add to the costs of a publication, it seems unlikely to represent an overriding economic incentive for membership of a new regulatory system that may apply further costs to news publishers.98 The Media Regulation Roundtable notes that membership of collective commercial partnerships such as participation in industry standards could offer a commercial incentive to join a self-regulatory standards body,99 but goes on to comment that, whilst incentives of this kind could be of some commercial value to publishers, they would not be strong enough to guarantee participation.100 The MST further argues that application of these incentives would be undesirable for two reasons. First, that it would concentrate power within the industry, and second that it would provide direct commercial benefits to publishers through their ability to restrict the business practices of existing or potential rivals and could thus be viewed as anticompetitive.101 The question of whether these incentives might give rise to competition law problems is considered above.102 I agree that this combination of incentives has the potential to make it very inconvenient for a major publisher to sit outside the self-regulatory regime. However, I also agree with the MST that this is essentially an economic calculation and that the extent to which they could actually encourage membership of the regime will depend on the costs of the impact of not being able to access these services together with the costs of compliance with the regime. Quite apart from the legal question of whether incentives such as these might be in breach of competition law, I would also have some concerns about the potential impact on small businesses and bloggers for whom the costs of compliance might be disproportionate. It would also be essential that membership of the self-regulatory regime should be available on fair, reasonable and non-discriminatory terms to all who want to join if there are to be real commercial effects from being outside the regime.

5.19

5.20

http://www.abc.org.uk/About-us/Who-we-are/ http://www.nrs.co.uk/index.html 97 p16, para 14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 98 p55, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 99 p21, para 72, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 100 p21, para 74, ibid 101 p56, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 102 at paragraph K4.2.22
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Assistance from the advertising industry
5.21 Lord Black suggests that there may be ways in which the advertising industry can help with building incentives for membership of a self-regulatory standards system.103 Ms Harman suggests two specific ways in which this might be done, first by requiring publishers who are not members of the system to pay a levy on adverts carried and secondly by advertisers agreeing to withhold advertising from publications that are not members.104 The latter is also hinted at by Mr Dacre.105 The levy concept has not been the subject of elaboration in evidence by anyone and, as such, is difficult to consider here. The concept that advertisers might withhold advertisements from non-member publications would require high levels of commitment from advertisers who, themselves, have nothing to gain from higher standards in the newspaper industry. The Inquiry has not been presented with any evidence to suggest that advertisers are ready to engage, or even contemplating engaging, in discussions around this. Furthermore, it is difficult to see what incentive there would be for the advertiser whose concern is to ensure that its product or the subject of its advertisements reaches the widest possible audience. Although this might be a powerful incentive if it could be put in place, I have seen nothing to suggest that it has any prospect of being adopted and see no reason why it should be.

Access to a dispute resolution mechanism
5.22 Many of the proposals present access to an alternative dispute resolution mechanism as an incentive to membership of a self-regulatory press standards system. Dispute resolution more generally is covered below. At this stage I am only concerned with its value as an incentive for, if it is to be seen as such, it must be something that is not available to non-members. The Media Regulation Roundtable proposal largely centres on its proposals for dispute resolution. Under this model, any complaint against a member organisation would go first to mediation by the regulatory body. If a complainant wished to start court proceedings in the case of a complaint of a legal wrong, then the court would stay the proceedings pending adjudication from the regulatory body’s tribunal. If mediation was unsuccessful then, where the complaint relates to a legal wrong, it would go to an adjudication process. This would provide a compulsory alternative dispute resolution mechanism that would have to be used by all complainants against members of the body, and all members of the body. If either party was unhappy with the result of the adjudication process they could, by agreement, go to the body’s Dispute Resolution Tribunal which would reach a conclusion binding on both parties. If the complainant was not happy with the result of the adjudication process it would still be open to him to pursue his complaint in court.106 This would serve as an incentive for publishers to join the self-regulatory standards body because it would ensure that all legal challenges against them would go, in the first instance, through a fast, fair and cheap adjudication process, thus hopefully reducing their exposure to expensive and slow court proceedings. As set out, this proposal would not prevent individuals from exercising their right to have a court consider their case; however, they would have to

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p36, para 69, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 104 p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf 105 p8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 106 pp8-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Regulation-RoundTable.pdf

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go through an adjudication process first, and the court would be likely to take the result of the adjudication process into account when considering their case. 5.25 Sir Charles Gray (a retired High Court judge whose expertise is in media law) told the Inquiry about Early Resolution, a voluntary service providing dispute resolution in media matters. He made it clear that Early Resolution had not been as effective as they had hoped because, whilst it was very popular with publishers, it was meeting with resistance from claimants, possibly because of the incentives acting on those advising claimants.107 For this reason, Sir Charles had reached the conclusion that a voluntary ADR scheme would not be able to act as an incentive; it would have to be mandatory, and mandatory for everyone, thus excluding the possibility of using such a system as an incentive for membership.108 The Coordinating Committee for Media Reform (CCMR) proposed an approach under which complaints, including enforcement of civil rights, relating to those publishers that have signed up to the scheme would be dealt with through the fast track tribunal system.109 Angela Philips accepted that it would be unfair to citizens who would get treated differently depending on who has traduced them, but said it was a necessary price for a significant incentive.110 Lord Hunt raised the question of why the industry would agree voluntarily to subject itself to a cheap system of arbitration which would potentially open them up to claims brought by members of the public who could not afford to pursue legal redress. He also asked why wealthy people would submit voluntarily to arbitration if they felt they might be able to intimidate a publisher with threats of a full court hearing.111 Taking a different view to Lord Hunt in relation to the industry, Mr Dacre suggested that access to swift and cheap resolution of defamation and privacy cases would be a major boon for both the industry and the public, and that it would be a huge incentive for a cost conscious publisher to sign up to a new regulatory system. Mr Dacre did not explain what he had in mind in any more detail but acknowledged that legislation would be required to deliver it.112 Ms Harman suggests that damages might be capped for member organisations or be higher for non-member organisations, but goes on to recognise that it might not be acceptable for a victim to receive less compensation because they were libelled by an organisation belonging to a regulatory regime. I agree with Ms Harman on this latter point. I do not believe that damages should be assessed at different levels or that the press should be given additional legal protection if they are members of a regulatory system, because any injury suffered by a claimant is no less simply because the title has signed up to a regulatory regime to which it then does not adhere. But it may be that the title would be able to rely on its membership of a regulatory regime as demonstrating adherence to standards of behaviour, on the basis that a title that is not a member would have the rather more difficult burden of proving that it adhered to appropriate

5.26

5.27

5.28

5.29

pp39-41, lines 19-19, Sir Charles Gray, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Afternoon-Hearing-12-July-2012.pdf This is likely to be related to the availability of Conditional Fee Agreements and After the Event Insurance, now substantially affected by Part 2 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012: see Part I Chapter 3 above 108 p35, lines 7-10, Sir Charles Gray, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-12-July-2012.pdf 109 p13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Coordinating-Committee-forMedia-Reform.pdf 110 pp36-37, lines 14-13, Professor Angela Philips, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/ Transcript-of-Morning-Hearing-8-December-20111.pdf 111 p38, para 119, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Hunt-ofWirral.pdf 112 p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf

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standards. The Irish model has this type of provision and they believe that proof would be difficult to achieve.113 In order to establish the incentive, it is also necessary to examine whether and, if so, how, claimants could be mandated or encouraged to use the ADR process. Benefits in legal proceedings 5.30 A number of the proposals put before the Inquiry suggest that a publisher should be able to benefit from some form of preferential treatment in libel proceedings as a result of membership of a self-regulatory forum. In this context, the Irish Defamation Act and its provisions for recognition of the Press Council and Ombudsman are sometimes offered as an example.114 Dealing here only with the proposals that have been made for aspects of the scheme to be adopted in the UK, this section looks at the potential for the courts to treat defendants favourably because of voluntary participation in some form of regulation and the extent to which this would form an incentive to membership. The Alternative Libel Project suggests that membership of a self-regulatory scheme could be incentivised by costs orders made by the courts but offers no detail as to how that might work.115 Ofcom also refers to this suggestion, but goes further and suggests that the level of damages might also be affected by whether a self-regulatory complaints handling system has been used.116 The Media Regulation Roundtable suggests specifically that additional damages might be awarded against those who are not members of a self-regulatory system and who publish defamatory material in contravention of the code of practice. No such additional damages could be awarded against a member of the system even where they were in contravention of the code.117 The Media Regulation Roundtable also proposes a form of statutory support for those wishing to bring proceedings against publishers outside of the self-regulatory system, by allowing such proceedings to be brought with conditional fee arrangements. In addition, costs would not normally be recoverable against unsuccessful claimants.118 It is possible to envisage a process by which costs might not be awarded even to a successful defendant where they were not a member of a credible self-regulatory system that offered access to ADR. With appropriate discretion in the court, that could potentially be extended to make the defendant responsible for all costs. It could also potentially extend to consideration of the costs implications of a claimant pursuing a title through the courts when there was a cheaper, faster ADR mechanism available because the publication was in a self-regulatory system which provided such access. Such an approach might be expected to encourage any publisher who felt they were at risk of defamation or privacy actions from those with very deep pockets to be a part of the self-regulatory system. It is less clear that any differentiation could (or even should) be applied to the level of damages. As identified above, I find it difficult to understand why it could ever be appropriate for the remedy offered by the courts to a victim of defamation or invasion of privacy to be affected by the defendant’s membership or otherwise of an industry body. By definition, having succeeded in a claim for damages, the relevant publisher will have failed to meet

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p54, lines 8-10, Professor Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-13-July-20121.pdf 114 the Irish Press Council and Ombudsman along with the Defamation Act are considered in Chapter J6.1. 115 p3, para 1.7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Alternative-LibelProject-English-PEN-and-Index-on-Censorship.pdf 116 pp18-19, para 4.16, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 117 p25, paras 86-87, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-MediaRegulation-Round-Table.pdf 118 p25, para 89, ibid

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those standards. Whether a deliberate decision not to participate in a voluntary regulatory mechanism might show disregard for standards (potentially justifying aggravated or exemplary damages) is another matter but I do not see how the compensatory award could be affected. 5.34 Lord Prescott119 and Ofcom120 go further than considering damages and refer in their submissions to the suggestion that access to certain defences in libel or defamation might be available to those who were part of a self-regulatory system. The essence of the proposal is that a defendant would be able to rely on compliance with a self-regulatory system and code of practice as evidence of responsible journalism and that this would constitute a defence. Professor Greenslade goes slightly further and suggests that a publisher standing outside of a self-regulatory system would be regarded as ‘failing to favour responsible journalism’.121 The Media Regulation Roundtable makes specific proposals for a defence of ‘regulated publication,’ which would allow a defendant to rely on the fact that they had complied with directions or requirements of the self-regulatory authority in relation to the relevant published material. Similarly, it would be a sufficient defence in a privacy claim to demonstrate that the public interest requirements of the code had been complied with.122 In relation to the latter, however, it is again difficult to see why, as a matter of legal fairness, such a defence should not also be available to a non-regulated entity that claims to have equal or higher standards with which it complied (even though, in the absence of membership, that fact might be more difficult to prove).

5.35

New legal rights and remedies against non participants
5.36 The Media Regulation Roundtable proposes the introduction of a statutory right of reply or correction, with appropriate prominence. These would be available only in respect of publishers who were not members of the self-regulatory body.123 These rights would be enforced by the courts. The effectiveness of the right to reply or correction as an incentive to membership of the self-regulatory body would depend on the relationship between the statutory right and the equivalent provisions in the self-regulatory code. If the statutory right is less onerous than the code provisions then it is unlikely to offer much of an incentive. If, on the other hand, the statutory provision were to be stronger than, or the same as, the code provision there might be some question as to the benefits to the public of the self-regulatory system. It is not entirely straightforward to see why publishers should effectively be able to opt out of a statutory obligation by joining a trade body that does not give equivalent public protection. That is not the only problem with this idea. The critical features of a right of reply are its immediacy and its ready availability. It is difficult to see how providing a mechanism through the courts will achieve either of these objectives.

5.37

p7, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-led-byLord-Prescott.pdf 120 pp18-19, para 4.16, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 121 p16, para 14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 122 p24, para 85, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 123 pp25-26, paras 88-91, ibid

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Exemption from ATVOD
5.38 One final incentive, suggested by the Media Regulation Roundtable,124 is that a press selfregulatory body could take on the statutory responsibilities under the Audio Visual Media Services (AVMS) Directive for regulation of audio visual content published by its members. This would ensure that newspaper websites would be regulated by the self-regulatory body, rather than ATVOD as would now be the case if any of them were to fall to be regulated under the AVMS Directive. This would also be in line with the proposal from Jeremy Hunt MP, then the Secretary of State for Culture, Media and Sport,125 in which he hypothesises a converged news regulator that would both provide self-regulation of the press and take on the statutory role required by the AVMS Directive, to ensure that the minimum standards laid down by the Directive are met.

Effectiveness of incentives overall
5.39 In any voluntary system of regulation it would be necessary to accept that some of the organisations who fall within the scope of the regulator might choose to sit outside the regulatory regime. If staying outside the regime is not a legal possibility, then it is not a voluntary system. It is common ground that, in order to be effective, any new system of press standards should cover all the national newspapers and at least the main magazines and regional and local newspapers. If publishers are not to be compelled to join then there must be a reason why they would wish to do so. The question that needs to be addressed is whether a sufficient package of incentives can be crafted that makes it strongly in the interest of all publishers to be a part of a voluntary standards system, without actually compelling them to do so. In the absence of a sufficiently strong package of incentives, one must either accept a voluntary standards system that some publishers chose not to be a part of, or find a way of compelling, rather than incentivising, membership. The possible incentives examined above are a comprehensive list of those that have been put to the Inquiry in evidence. There may well be others, but if there are I have not had them brought to my attention. I am satisfied that in kind, if not necessarily in detail, the list above includes all the obvious possible approaches to incentivisation (and some that are not so obvious). Of those proposed, I can see merit in kitemarking. There are clear benefits to providing consumers with information, though no evidence has been presented on whether a kitemark would have any effect on readers’ buying habits. Some publishers might be keen to demonstrate that they operate to the highest standards. On the other hand, no evidence has been presented to suggest that kitemarking would be anything other than a minor incentive and those least likely to want to join a voluntary press standards body are likely to be the least concerned to demonstrate their adherence to standards. The concept of a package of commercial benefits from membership would bear further investigation. Any specific proposal would need to be tested against competition law. Even where limiting a commercial benefit to members of a voluntary standards body would be possible legally, it is not axiomatic that it would also be desirable. Any of these proposals would need to be looked at and evaluated in detail; this has not been possible because they have only been presented to the Inquiry in the most general of terms.

5.40

5.41

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p21, para 72, ibid p4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Sumission-from-Jeremy-Hunt-MP.pdf

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5.43

The benefits to publishers of an ADR regime seem obvious, and if individuals could be compelled to use such a regime that would be a powerful incentive. However, it is not possible to deprive individuals of their right to pursue or defend their rights in court and, on its own, any voluntary ADR mechanism is in my view unlikely to prove significantly compelling to publishers. I do not accept that it would be appropriate for differential damages to be awarded depending on the regulatory status of the defendant. However, there does seem to be real potential in constructing a costs regime in relation to privacy and libel cases that would make membership of a voluntary system a significant benefit to any publisher likely to face such challenges. Whether the benefit would be significant enough to encourage all national publishers into a voluntary system is impossible to forecast at this stage. Furthermore, if it is to be fully recognised within the costs regime operated by the courts, it would be highly desirable, if not essential, that the regulator providing the ADR mechanism be formally recognised and, thus, validated. I am satisfied that there is no realistic prospect of using the VAT zero-rating, or any other method of discrimination based on tax, as an incentive for membership of a press standards body. I conclude that restricting journalistic accreditation to members of a press standards body would be difficult and runs the risk of being a real threat to freedom of expression. Ultimately, the one incentive that we have heard about that has been demonstrated to be effective is the realistic threat of press standards legislation if an adequate voluntary body with full coverage is not forthcoming. Professor John Horgan, the Irish Press Ombudsman, told the Inquiry that the creation of the Irish Press Council had been under consideration for decades before eventually significant political pressure for statutory regulation of the press made the industry focus:126 “Then in the middle 90s, after the collapse of a big newspaper group, the government set up a commission on the newspaper industry, of which I was a member, and which all major newspaper interests were also represented. The report of that body recommended the establishment of a Press Ombudsman in 1996. But nothing really happened after that. Nobody took ownership of it, and it wasn’t developed in any sense. Then after the 2002 general election, the then minister for justice, Michael McDowell, set up an expert group to make recommendations to him. And that expert group reported in 2003, recommending a statutory system of regulation for the press. I think it’s fair to say that that lit the fire under the topic in a way that it hadn’t been lit before, and the press industry realised that if this eventuality was to be avoided, they would have to come up with something that was credible, authoritative, independent and on all these fronts sufficiently acceptable to government, so the government would not proceed with its plans. They then set up the Press Industry Steering Committee, which negotiated and deliberated for some four years.” And in a subsequent exchange he said: 127 “LORD JUSTICE LEVESON: But behind it all, do I gather from what you were saying somewhat earlier, was the threat of statutory regulation? A. Absolutely.

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5.45

pp51-52, lines 2-1, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-13-July-20121.pdf 127 pp55-56, lines 23-18, Professor John Horgan, ibid

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LORD JUSTICE LEVESON: So in other words, it behoved the press interests to come up with a solution that was less than the club that was being held over them? A. That is absolutely the case. And in fact my membership, or our membership of the Alliance of Independent Press Councils of Europe indicates that in quite a few countries this threat has been the engine which has generated or promoted the successful establishment of press councils of the same kind in many European countries. So even though before this threat was made, there had been moves towards the establishment of something like this, the 1996 report of the commission, which wasn’t under such a threat, recommended the establishment of an ombudsman. As I said, it was the real and present danger of that that created the situation in which we found ourselves.” 5.46 Similarly, Lara Fielden, in her comparative study of international press councils published by the Reuters’ Institute, says:128 “While..., the Press Councils considered here adopt many highly distinct approaches to their functions, frameworks, and powers, and while each has been established against a very different historical, political, and cultural backdrop, a common theme emerges in the form of the galvanising effect of the threat of statutory intervention. A recognition of the importance of ethics and accountability, and debates between publishers and journalists, may be significant. However the decisive trigger to the establishing, or reform, of a Press Council is commonly a proposal for statutory regulation that is held to threaten press freedom and results in a determined, pragmatic alternative response from the industry.” 5.47 This has also been broadly the case in the UK, as demonstrated in Part D, Chapter 1, where I note that there has been a pattern of the press undertaking to make changes when faced with a threat of legislation. The fact that these promises have often not been followed through with meaningful action may demonstrate that, in order to be effective in securing real industry action, the threat must be exceptionally credible; to date, that has not generally been the case in the UK. Such a threat could be perceived to exist now and I have no doubt that the proposals put before me by Lord Black spring solely from the fear that I might recommend a legislative regulatory solution and that such a recommendation might be accepted by the Government. Indeed, Lord Black described the process of arriving at his proposals as a substantial one, leading to something completely different from anything that has gone before,129 going on to say:130 “That has only come about, I think, because of the opportunity that this Inquiry has given us to be able to analyse the things that have gone on in the past and see how we can try and rectify them for the future.” 5.49 Whilst it is no doubt true that the mere existence of this Inquiry has focussed minds, I do not think it is possible to rely on any perceived threat from the Inquiry itself to encourage publishers to join a self-regulatory system. Any such threat would have to be provided by the Government of the day and credibly represent a real intention to legislate quickly should an

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pp21-23, para 2.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Reuters-Institute-for-theStudy-of-Journalism-submission-April-2012.pdf 129 pp27-28, lines 14-8, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 130 p28, lines 9-12, ibid

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acceptable industry solution not be forthcoming: that was tried by Sir David Calcutt but the effect was merely to postpone the issue until other more pressing political concerns took their place.

6. Statutory recognition
6.1 Even in an entirely voluntary self-regulatory system it might be considered desirable to have some form of statutory recognition for the purpose of encouraging or rewarding membership of, and compliance with the standards set by, the voluntary body. This is perhaps best illustrated by reference to the Irish Press Council, which is fully independent of Government and membership of which is entirely voluntary. An Irish Press Council could exist in any form, with any structure, but the Defamation Act 2009 in Ireland provides for a defence of fair and reasonable publication,131 with the courts taking into account the extent to which the publisher has adhered to the standards set by the Press Council or, if the publisher is not a member of the Press Council, equivalent standards.132 Recognition of this sort would require the voluntary body to have some statutory existence. In the Irish case, the Defamation Act includes substantial detail on the composition and appointment of the Press Council and the appointment and procedures of the Press Ombudsman, but only a few overarching points about the existence and coverage of the standards code.133 It also sets out the process for recognition of the Press Council by the Parliament, once the Minister has satisfied himself that it meets the criteria set out in the Act.134 Lord Black’s proposed solution did not include any incentives that would require statutory recognition, but did include the potential to include an ‘arbitral arm’. He recognised that the creation of an arbitration system of that sort would require changes to statute but was unclear precisely what sort of changes would be required.135 Lord Black was emphatic that he did not consider that any other area of statutory relationship was necessary or desirable in order to implement his proposal.136 Mr Dacre said that although the introduction of an arbitral arm would require changes to libel legislation it deserved the fullest support.137 Lord Black was strongly of the view that any statutory involvement in press regulation would give rise to concerns about freedom of the press:138 “I’ve never seen a model of statute proposed which would not in some way invite the state into the regulation of editorial content.”

6.2

6.3

6.4

s26, Defamation Act 2009 pp53-54, lines 16-7, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-13-July-20121.pdf 133 schedule 2, Defamation Act 2009 134 s44, Defamation Act 2009 135 pp54-56, lines 7-21, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 136 p57, lines 11-20, Lord Black, ibid 137 p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 138 p30, lines 18-20, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf
132

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6.5

Other proposals generally did not deal with this issue of statutory recognition explicitly. Lord Prescott states that “some incentives will need statutory support.”139 Ofcom sets out a number of potential statutory incentives, including costs in legal cases and a new defence for defamation.140 The MediaWise Trust,141 through positive reference to the Irish model, implicitly accepts the need for a statutory basis for such incentives but makes no comment on the desirability or otherwise of it. Similarly, the CCMR142 and Professor Greenslade143 implicitly accept a role for the state by promoting the application of VAT zero-rating as an incentive for membership, but do not explicitly comment on the implications of such statutory recognition. The Alternative Libel Project argues for voluntary ADR which is supported by new rules on costs and more consistent and robust case management.144 They are not precise on whether this would require legislative changes. Professor Greenslade explicitly accepts that some legislation might be required to construct ‘sanctions’ for non compliance, without being specific on what that might be. He is clear, though, that this is to be an arms length relationship with statute:145 “I would therefore urge that the state’s role is restricted to creating a framework at arm’s length in order to create a regulator that is both independent of the industry and independent of the state.”

6.6

6.7

He also argues that the judiciary should take into account whether a publisher has signed up to a regulatory system,146 but does not propose any statutory basis for that: “just sticking to the press regulator itself, in my view it is quite clear that you are not going to keep everyone on board, not going to be able to levy sanctions against them, unless there’s a method of compulsion. I have tried to devise a way in which this is as far away from state intervention as it can be.” 147

6.8

Lord Soley suggests that a regulatory body should have the power to take a case to court if necessary.148 It is not clear whether he means in relation to existing criminal or civil law or with respect to any new rules on standards. Generally, it would appear that there is a divide between those, exemplified by Lord Black, who have concerns that any reference in statute to press standards regulation would be a potential risk to freedom of expression and those who see no immediate problem with legislation that recognises a voluntary self-regulatory regime. It is not, however, clear that

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p2 and p7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-led-byLord-Prescott.pdf 140 pp18-19, para 4.16, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 141 pp14-15, para 3.04, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1. pdf 142 p12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Coordinating-Committee-forMedia-Reform.pdf 143 p16, para 14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 144 pp4-5, para 1.14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Alternative-LibelProject-English-PEN-and-Index-on-Censorship.pdf 145 pp10-11, para 7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 146 p16, para 14, ibid 147 pp22-23, lines 23-5, Professor Roy Greenslade, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-12-July-2012.pdf 148 pp3-4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Second-Submission-by-Lord-Soley-ofHammersmith.pdf

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the extent to which statutory recognition of a self-regulator would need to, or could, go into detail about the scope, governance and processes of that self-regulator have been fully considered by all of the witnesses.

7. Statutory provision
Statutory underpinning
7.1 Many of the proposals submitted to the Inquiry go beyond statutory recognition and advocate some form of statutory underpinning for regulation of press standards. There are a number of different statutory models proposed which I briefly set out and consider here individually. The level of statutory underpinning differs from proposal to proposal. At one end of the spectrum are those that simply use statute to define the characteristics of an otherwise independent and voluntary body. At the other end are models that also use statute to compel compliance. This difference was set out clearly by Mr Suter:149 “What’s the difference between statutory underpinning and state control? By state control I think everybody has set up this dangerous notion that the state would dictate what the press could do, would dictate the standards by which the press had to operate and would form judgments as to what was or was not acceptable. I see statutory underpinning as being further removed from that, or setting a framework within which the regulation happens, but where the regulation itself is carried out by independent bodies dealing directly with the press and the regulated entities.” I have essentially used this distinction in considering the models that have been presented to the Inquiry. Models that put the definition and enforcement of standards in the hands of a statutory body are considered below as statutory regulation.150 The industry position 7.2 It is worth starting by considering the industry position on statutory underpinning. Lord Black makes it very clear in his submission that the industry rejects, as a matter of principle, any form of statutory involvement in, or underpinning of, press standards regulation.151 This is not an argument about the strength of regulation but rather about the freedom of the press from state control:152 “I have always believed – and I believe it is a view across the bulk of the industry – that self-regulation is the guarantor of press freedom and interference (sic) from state control.” 7.3 Lord Black argued that self-regulation could be tougher than a statutory system and that this meant that statutory control was not needed.153 He further argued that, as a matter of

p48, lines 14-25, Tim Suter, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-12-July-2012.pdf 150 para 7.20 -7.25 151 pp17-20, para 16-27, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Blackof-Brentwood1.pdf 152 p11, lines 21-24, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-9-July-2012.pdf 153 p11-12, ibid

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principle, it was essential that press regulation should be free of statutory intervention.154 He raised three specific reasons why a statutory basis for regulation would be inappropriate. The first was speed. He argued that no form of statute could keep pace with a fast moving industry in the way that self-regulation could.155 I accept the point that the regulations themselves need to be capable of relatively swift amendment, but I am at a loss to see why the overall structure of regulation would need to be affected by change in this way. It is entirely possible to imagine a statutory framework, at a very high level, that would simply require some form of regulation to exist and define the accountability structures, leaving all the material regulation to a separate, possibly self-regulatory, process. This does not seem to me to be a compelling argument in relation to establishing a regulator, still less providing for the recognition of a self-regulatory body, in legislation. I note in passing that other industries also operate in a fast moving environment – for example, broadcasting and telecommunications – where the speed of technological and market change is no less then in the press and media industry, and nonetheless manage to exist perfectly well with statutory regulation frameworks. 7.4 The second reason advanced for avoiding statute was the risk of ‘losing coverage from the system’.156 The argument here is that if publishers did not want to comply with the statutory regulation they might relocate their operations outside the UK in order to place themselves outside of the jurisdiction of the statute. I can accept that this is potentially a valid argument in relation to the economic effect of any compulsory regulation. Clearly, if regulation is to be compulsory then some people may seek to evade it. This may be a simple step for those whose business is primarily online, although I am less convinced that it is a realistic prospect in relation to a printed product which would need to be imported to the UK and distributed on a daily basis. In any event, I cannot see how that is relevant to the impact on the ‘coverage of the system’. A publisher wanting to avoid a compulsory system would have to take steps to do so and may or may not be able to achieve that. A publisher wanting to avoid a voluntary self-regulatory system would simply have to put themselves outside it. It is not at all clear how this would achieve greater coverage. The third reason advanced was that a statutory system would be subject to constant legal challenge.157 This gets to the heart of the industry’s position on any form of statutory underpinning for regulation, or indeed, any proposal other than their own, which is that they will render it ineffective by whatever means possible. This was articulated quite clearly by Lord Black: 158 “A statutory system which would be forced on a majority of unwilling publishers is likely to become a target to be aimed at rather than something – a framework within which to be worked for the benefit of both the public and the public interest.” This is not the attitude of an industry committed to raising standards and acting in the public interest and must be seen as what it is likely to be: an attempt to use the economic and political power of the press to defend their own interests. 7.6 It is worth reflecting a little on the evidence that Lord Black gave in respect of his objections to any statutory involvement. Robert Jay QC pointed out that a statute could do exactly what the proposed contract does, both in terms of giving powers to the regulator and by way of

7.5

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pp11-12, lines 20-3, ibid pp12-13, lines 21-2, ibid 156 p13, lines 3-5, ibid 157 p13, lines 9-15, ibid 158 p17, lines 16-21, ibid
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imposing limits on what the regulator could do. Lord Black did not dissent but expressed a ‘philosophical objection’:159 “I – there is a fundamental objection that I have and I believe that the bulk of the industry has in allowing the state to write the rules of a regulator that governs editorial content. It’s not just writing the rules, but presumably producing the style of the system and the type of the system that will be there to enforce it. It’s not a circle, I think, that can be squared. It is a fundamental philosophical objection to the role of the state in the content of newspapers and magazines.” 7.7 In a subsequent exchange he emphasised the point:160 “LORD JUSTICE LEVESON: Well, that means there may be a statute which does not create a difference between what the statute could do and what the contract could do. A. The fundamental philosophical objection to it would remain!” and again, later:161 “Q. We’ve defined our terms according to your lexicon, although, looking at Dr Moore’s evidence, he would define the statutory underpin system as equally one of self-regulation because there would still be a significant press component or press representation within such a system. Do you accept that? A. No, I don’t – I don’t – I don’t believe that – statutory underpinning is simply a term of art for a form of statutory control. I don’t believe there is a halfway house between them.” 7.8 It is not clear, though, that Lord Black is entirely consistent in his opposition to statutory involvement. His proposal envisages the possibility of an arbitral arm as part of the regulatory body. This, he acknowledges, would require some form of statute in order to make it compliant with Article 6 ECHR.162 Whilst Lord Black was clear that he has no precise proposal for legislation on this issue at present, he was equally clear that his principled objection to statutory control did not apply in this context:163 “I have no idea exactly how we would manage that, which piece of legislation we could do it in. All I know is it’s not immediately on offer. The point of highlighting this here is that the structure of the system would allow it, if at some point Parliament saw fit in order to – saw fit to institute it.” 7.9 Lord Black was not able to articulate why this from of statutory recognition or underpinning for a form of press regulation was acceptable to the industry whilst any other form of statutory recognition or underpinning, no matter what its form or content, could not be. The only conclusion I can draw is that statute providing for an arbitral system would be in the interests of the press whereas, in their perception at least, statute providing the framework for robust independent regulation would not be.

159 160

p32, lines 12-20, ibid p33, lines 16-21, ibid 161 pp46-47, lines 19-3, ibid 162 p54, lines 17-21, ibid 163 p56, lines 16-21, ibid

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7.10

Lord Hunt clearly shares Lord Black’s principled objection to a high degree. However, it is perhaps not so clear cut. He told the Inquiry that recognition of a code, as in the Irish Defamation Act, would not constitute a statutory regulatory system.164 View of others

7.11

The MST put forward an approach which would place statutory obligations on large news publishers to regulate themselves by providing internal complaints and compliance mechanisms and by joining an external self-regulatory body.165 The statute would then establish a ‘Backstop Independent Auditor’ (BIA) which would oversee compliance with those obligations. The self-regulatory bodies would be responsible for setting their own standards, governance arrangements and funding but the BIA would have to approve them, having regard to a set of issues already set out in para 3.2 above.166 The BIA would have the power to fine a large news organisation that failed to comply with required governance standards167 or to join an approved self-regulatory body.168 Where a self-regulatory body is found to be in breach of required standards, the BIA would have the power to report publicly on the failure, hold public hearings, impose fines and, in extremis, remove the recognition.169 One specific concern about this proposal is the risk that a body such as the BIA, whether an individual or a corporate entity but one with no track record, limited powers and limited duties, would simply not have the strength and credibility to stand up to the press industry should the need arise. As has been seen throughout the Inquiry, the press is very active and very able when it comes to lobbying for their interests. I have identified in Part H how successive Information Commissioners have been persuaded that they should not concern themselves with the activities of the press. It is only to be expected that the press, if faced with a new regulatory system over which they do not have complete control, will seek to mitigate its impact by whatever means are open to them. Given that this includes the potential use of their megaphone to criticise heavily any organisation, and the individuals who run it, it follows that a high degree of resilience and strength would be required by any organisation required to take on the role. Mr Suter’s proposal shares a number of features with the MST but is closer to statutory regulation, as I have defined it here, than statutory underpinning. In Mr Suter’s model, Ofcom would have a statutory duty to establish a set of regulatory outcomes, which would define what activities or media services must be subject to regulation; these could be determined by a number of factors including the size of the organisation and the nature of the services it provides, and could define the outcomes expected as a result.170 These outcomes would be rooted in four principles:171 “– respect for privacy; – respect for the truth and fair dealing in reporting;

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pp65, lines 3-13, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 165 p72, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 166 pp89-90, ibid 167 pp65, lines 3-12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-Afternoon-Hearing10-July-2012.pdf 168 p81, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 169 p90, ibid 170 p2, para 8-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Tim-Suter-ofPerspective-Associates.pdf 171 P2, para 10, ibid

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– upholding ethical standards of behaviour in news-gathering; – providing information to allow vulnerable audiences to make informed choices.” 7.14 Under Mr Suter’s proposal those services identified by Ofcom would be required to join an authorised self-regulatory body. The authorisation process, and regular auditing, would be carried out by a re-structured Ofcom Content Board.172 The requirements to obtain authorisation a self-regulatory body are set out at para 3.3 above and relate to independent governance, scope, powers and funding.173 If an organisation falls to be regulated under Ofcom’s framework, but declines to join an authorised body, then it would fall to Ofcom to regulate that organisation against the authorised code considered most appropriate by the Ofcom Content Board.174 Where Ofcom has deemed that regulation is required and no authorised industry body yet exists to define a code of its own, the Content Board would draw up a relevant code itself.175 It is this final element of the proposal that makes Mr Suter’s approach potentially cross the boundary from statutory underpinning (requiring selfregulation) to statutory regulation where the regulator both sets the standards and enforces them. Ms Harman considers an approach which would use statute to provide for the independence of a standards body and to give it jurisdiction to enforce its decisions across all newspapers. In this model online news outlets would be able, but not required, to join the system.176 Mr Eustice recommends giving Ofcom powers to require adequate governance from newspapers to ensure that they are:177 “organised in such a way that allows them to comply with both the Editors’ Code and the law.” This would not give Ofcom any jurisdiction over standards.178 He also advocates giving a right of appeal to the Information Commissioners’ Office in relation to privacy complaints. This would apply to all media, including the internet, and the ICO would be enforcing existing laws.179 7.17 7.18 Ofcom suggests that statute might be necessary in order to set out the governance standards for a voluntary regulator, including appointment processes, independence and accountability.180 Sir Charles Gray, on behalf of Early Resolution, argues for the establishment of a statutory independent media regulator and compulsory ADR.181 Sir Charles does not specify in detail what the role of the statutory regulator would be or how much should be laid down in statute but his primary concern is that compliance with standards should be statutory, as an essential

7.15

7.16

p3, paras 13-16, ibid pp3-4, para 17, ibid 174 p5, paras 21-23, ibid 175 p5, para 23, ibid 176 p4, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QCMP-on-behalf-of-the-Labour-Party1.pdf 177 pp5-6, para 2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-George-Eustice-MP. pdf 178 ibid 179 p6, para 4. ibid 180 pp13-14, para 4.24-4.30 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom. pdf 181 p12, para 9.1-9.2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Early-Resolution. pdf
173

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partner to his proposed mandatory ADR route. He did not express any opinion on by whom standards should be set.182 7.19 The NUJ put forward a proposal for a statute setting up a new regulator which would be able to take complaints, enforce penalties, carry out investigations and monitor performance. The legislation would define the membership and jurisdiction of the body and how the body was to be funded.183 The regulator would have a role in, but not control of, drawing up a code of practice.184 The regulator would have statutory jurisdiction over all publications of a certain size and their associated websites,185 as well as statutory power to fine for breaches and to insist on the size and placement of a correction or apology.186 Membership would draw on journalists, the public, newspaper owners and editors and pressure groups.187 Mr Mosley proposes an independent but non-statutory standards setting body that would have much in common with the current PCC but with a more independent appointments process and a greater proportion of independent membership. The standards body (rather than serving editors as now) would be responsible for setting the standards.188 There would also be a statutory tribunal with the power to enforce those standards, with compulsory jurisdiction over all of the press, agencies of the press and the internet (where not subject to Ofcom).189 The Tribunal would have statutory powers inter alia to deal with complaints, to require disclosure of information, to award damages, to levy fines, to order a correction (specifying content, location and prominence), prevent publication of a story and order an item to be removed from the internet. The statute would also provide a statutory public interest test in relation to privacy matters, impose a prior notification requirement in relation to publication of private matters and provide that such prior notice is confidential.

7.20

Statutory regulation
7.21 There are some proposals that go beyond a call for statutory underpinning to self-regulation and suggest statutory regulation which is not based around industry ownership of standards or process. Sir Louis Blom-Cooper QC proposed the establishment of a statutory Commission on the Media.190 Members of the Commission would be appointed by an appointments commission established for the purpose by Parliament. The functions of the Commission would be:191 (a) (b) to receive and adjudicate on readers’ complaints of breaches of the code of ethics; and to carry out public inquiries, with power to subpoena witnesses and require disclosure of evidence, into press activity that has aroused public concern.

7.22

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pp36-37, lines 5-8, Sir Charles Gray, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-12-July-2012.pdf 183 pp8-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 184 pp8-10, ibid 185 pp10-11, ibid 186 pp10-11, ibid 187 pp1-12, ibid 188 pp1-2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 189 pp2-4, ibid 190 p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/First-Submission-by-Sir-Louis-Blom-CooperQC.pdf 191 pp15-18 ibid

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Sir Louis does not elaborate on what powers of remedy, redress or sanction this statutory body should have. 7.23 The Campaign for Broadcasting and Press Freedom recommend the establishment of a statutory Media Standards and Freedom Council.192 In the first instance the Council would be appointed by an appointments commission set up by the Ministers. The Council would be made up in the following proportions: (a) (b) (c) (d) 7.24 media owners and editors – 20% media trade unions – 20% members of the public nominated by civil society organisations – 50% members of the public selected by a process of application – 10%.

The Council would produce a code of ethical standards, adjudicate on complaints about compliance with that code, administer a public right to redress and keep and publish records relating to compliance. The Council would also issue guidance and advice to the media and report annually to Parliament. Where the Council found that standards had been breached it would be able to require a printed clarification, retraction or apology in a corrections page in the publication. The Council would be able to apply to the courts for an order to enforce its ruling where necessary. The Media Regulation Roundtable proposes a largely statutory, but voluntary, approach. Mr Tomlinson QC explained that in his view self-regulation was not an appropriate tool:193 “Well, by “self-regulation” I understand that ultimately, whatever the industry or the body is, it’s regulating itself. And it seemed to us that actually there are two interests at play. There’s the interests of the media and there’s the interests of the public. And unless the regulation is independent of both, you’re not going to have true and effective regulation. So I don’t myself agree that an independent self-regulation, if that is a meaningful phrase at all, is the proper way to proceed.”

7.25

7.26

Under the Media Regulation Roundtable proposal, a Media Standards Authority would be established by statute, with its governance arrangements set down in legislation.194 The statute would also impose a duty to uphold the freedom and independence of the press.195 The Authority would have statutory duties to establish a Code Committee (with a minority of working editors and journalists) to prepare a code of practice. The Authority would also have to establish a system of regulation, including pre publication advice and complaints handling, and to set up dispute resolution tribunals. The Authority would, however, only have jurisdiction over those who chose to join it.196

Summary
7.27
192

It is clear from the descriptions above that there are many different possible approaches to the use of statute in relation to securing the highest press standards. These approaches range

p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-The-Campaign-for-Press-andBroadcasting-Freedom.pdf 193 p6, lines 5-14, Hugh Tomlinson QC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf 194 pp5-6, paras 8-12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-MediaRegulation-Round-Table.pdf 195 p7, para 13, ibid 196 pp7-8, paras 14-15, ibid

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from establishing in statute the characteristics of a self-regulatory body that would have some standing in civil law, through the statutory establishment of a body that would recognise one or more self-regulatory bodies, to the statutory establishment of a body that would define a set of standards to be adhered. Any of these approaches could, but need not be, coupled with a statutory requirement for compliance with a set of standards. There are a different set of questions about the use of statute in relation to improving the handling of civil cases; those are considered in section 13 below. Strong cases have been advanced for each of these different approaches and it seems to me that any of them might have merit. The essential point is that a balance must be struck between the use of statute to deliver independence from industry and the risk that the use of statute might introduce some element of state control of the press which is clearly unacceptable. 7.28 I do not accept that there is any issue of principle preventing, in any circumstance or howsoever framed, the use of legislation in respect of press standards. The question whether any particular statutory provision might give rise to any potential infringement of freedom of expression or the freedom of the press, or even the remotest risk of such an infringement, can only be looked at in the context of the specific provision and any statutory or other protections that could be built in.

8. the Code
8.1 Each of the models for standards regulation put before the Inquiry includes the existence of a code of standards that those within the regulatory system should comply with. The Inquiry considered a range of evidence in relation to two specific issues: who should be responsible for drawing up the code; and what should be contained within it. I deal with those two issues separately.

Who should be responsible for drawing up a standards code?
8.2 Four different options have been put forward as to who should be responsible for drawing up the code. The first is that proposed by Lord Black, and endorsed by Lord Hunt and Mr Dacre, that the code should be developed by a committee comprised of a majority of serving editors with some lay membership. The second, advanced by, among others, the MST and Lord Prescott, is that the code should be drawn up by the industry, possibly in conformity with very broad standards set out either in regulation or by an independent body. In these models a code that did not meet relevant standards would not be acceptable. In the third model the code would be drawn up by an independent body with representation from both industry and the public. In the final model the code would be developed by an independent regulator. I will look first at the situation where a code is to be devised by a set of serving editors, albeit with some support from lay members. Professor Greenslade argues that there has been little if any controversy about the code and little or no criticism of the changes made by the editors’ committee.197 He therefore concludes that editors should remain in the majority on the code committee, but that they should be joined by a new Press Ombudsman, public representatives and some representatives from the NUJ.198 The Carnegie Trust urges that industry representatives, including editors and journalists, should continue to play a significant

8.3

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role in overseeing the standards required of the industry, but they do emphasise the need for citizens and members of civil society to be given a more prominent role in the process. It is suggested that this might be achieved by adding lay members to a code committee but that this could be strengthened by an ongoing programme of research into the standards to which citizens feel the press should adhere.199 8.4 The advantages of having standards set by serving editors are reasonably self evident. Current editors will be best placed to understand the industry, its practices and the impact of technology and competition, in order to take a view on what is practical to deliver. Similarly, as the Carnegie Trust points out, the involvement of industry in drawing up the code of practice should ensure buy-in in terms of adhering to the standards set out in it.200 Professor Greenslade took the view that the performance of the Code Committee to date was proof that the system was effective:201 “the Code Committee is a very, very straightforward matter, not problematic in my view, and working editors on it makes sense. It’s not as if they’ve designed the code in private to favour themselves. The code has, in fact, constrained them, and so – you pointed out that it’s largely very negative in that sense. So I would have thought the code is an example of the editors having behaved rather well.” 8.5 However, the disadvantages also seem to me to be clear and are persuasive. Mr Richards was extremely clear that, from an Ofcom perspective, it would be entirely inappropriate for serving editors, or others currently active in the industry, to have any part in approving the standards to which the industry should conform. He said: 202 “I think we would draw a very very strong and clear distinction between advice which I think it is very important to take from those with experience and ideally recent experience of the relevant industry in which we do our sales, and the precedents on decision-making or determinative functions of the regulator of participants and active – people actively involved in the industry at present. I think that is quite the wrong thing to do and makes effective and reliable independent decision-making extremely difficult, and to be honest in our context is unimaginable. The idea that we would have and we could stand up in public and defend decisions we made if we had serving broadcasters on our decision-making bodies or on our code-setting bodies, I think is – LORD JUSTICE LEVESON: Even on the code-setting body? MR RICHARDS: Yes. DR BOWE: Yes. MR RICHARDS: Yes, absolutely. And I will say in terms of code setting, in terms of sanctions, in terms of corrections or anything of that kind and in terms of policy making overall, you need to have a bright line separation between those who are regulating and making decisions and those who are regulated, and I think any breach of that in my view, in our experience, means that you will immediately undermine the perception and indeed in all reality the actuality of your independence.”
p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf p6, ibid 201 p32, lines 6-15, Professor Roy Greenslade, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-12-July-2012.pdf 202 pp101-102, lines 7-9, Ed Richards and Colette Bowe, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Transcript-of-Morning-Hearing-12-July-2012.pdf
200 199

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8.6

That is a general matter of good regulatory practice, but it seems to me that there is also an industry specific point to consider here. In most models of self-regulation where serving professionals are involved in any way in the process of regulation, the pool from which those serving professionals can be drawn will be many thousands of people. In terms of editors of national newspapers, however, the pool is limited to no more than 20 or so. It is in this context that editors have been described as ‘marking their own homework’. Indeed, when it comes to the role of serving editors on the code committee, it might just as aptly be seen as editors setting their own homework. It is clear that there are a number of very powerful individuals within the industry who have, or are perceived to have, a strong influence on others in the industry. This means that, if serving editors are in the majority on a code committee, there is the risk of power being located in the hands of one or two people who have the most to gain from setting standards that they are prepared to live with, rather than standards that are set with the best interests of the public in mind. None of this is to argue that serving editors do not have an important role to play in advising on the standards to be set. The issue here is simply about whether they should be responsible for taking the actual decisions as to what standards should apply. The second model I consider is one whereby the press (quite possibly, but not necessarily, including serving editors) draw up the code but the code then has to be approved or recognised by some independent body. Lord Prescott says that it makes sense for the industry to remain the primary drafting body for the code but:203 “that in order to maintain credibility in the eyes of the public the code should be reviewed and endorsed by ‘a body with the interests of the public, not the press, at heart, which could be the regulator, Parliament of another body appointed by Parliament.”

8.7

8.8

This model is also adopted by the MST and Mr Suter, who both put the need for selfregulatory industry bodies, setting their own standards, at the heart of their models. In the MST model, the Backstop Independent Auditor would provide written guidance on the minimum commitments that it expected to be contained within a code of practice and would then look for those minimum commitments to be met when considering approval of a selfregulatory body.204 In Mr Suter’s model, Ofcom would set out high level regulatory outcomes to be achieved and the Ofcom Content Board would look to see that the self-regulatory body had given itself appropriate scope and powers to deliver those outcomes in considering authorisation.205 In both models the detail of the standards code, and the process of arriving at that detail, would be a matter solely for the relevant self-regulatory body. The third model I look at is that of an independent body with a mix of industry and public representation. Mr Mosley proposes replacing the PCC with a Press Commission with an independently appointed chairman but membership otherwise largely unchanged. His approach involves this body being solely responsible for making and amending the code of practice.206 This Press Commission is not a regulator as it has no powers of enforcement and simply sets the standards. Finally I come to the model which has standards setting simply in the hands of the independent regulator. The Media Regulation Roundtable makes the drawing up of a code the ‘central

8.9

8.10
203

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p14, para 14, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-ledby-Lord-Prescott.pdf 204 p89-90, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 205 p2, para 9 & p3-4, para 17, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-TimSuter-of-Perspective-Associates.pdf 206 pp1-2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf

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function’ of their proposed Media Standards Authority. In order to do this they would establish a broadly representative committee, including serving editors, as well as journalists and independent figures.207 The Campaign for Broadcasting Standards and Press Freedom proposes that a statutory Media Standards and Freedom Council should be responsible for producing a code of ethical standards “in consultation with the media industry and the general public.”208 Sir Louis Blom-Cooper advocates that a statutory independent regulatory body would be responsible for a code of ethics.209 The CCMR would give full responsibility for establishing and updating standards to its statutory, but voluntary, News Publishing Commission. The Commission would include editors, journalists and members of the public.210 8.11 A number of the proposals leave the matter of ownership of the code somewhat obscure. The MediaWise Trust talks of a new code211 but does not say who is to be responsible for drawing it up. The NUJ says that “the new regulator should have a role in drawing up a code of practice”212 but stops short of saying who should have the ultimate responsibility for deciding on the contents of the code. In many ways this issue of who is responsible for setting the standards goes to the very heart of a new regime. It is important to balance the current industry expertise inherent in serving editors and journalists with the need for independence in setting standards. It seems to me that the appropriate balance is provided by some form of system that draws heavily on current editorial expertise via an advisory body, but leaves the ultimate approval of the code to a more independent regulatory body which has the primary duty of serving the public interest in respect both of the freedom of the press and the rights of individuals.

8.12

Contents of the code
8.13 I turn now to the content of the code. It has been said by many witnesses to the Inquiry that the current Editors’ Code of Practice is a good code. There certainly seems to me to be a substantial consensus that the existing code captures much good practice. Ms Harman, for example, sees no need for changes to the code:213 “It is widely acknowledged by editors, journalists, campaigners, and academics that the current Editors’ Code of Practice is broadly fit for purpose – the key issue is its enforceability. The Code – which covers fairness, accuracy, the differences between reporting and comment – could continue to be used.” However, there have also been reservations expressed in relation to some aspects of the code.214 This chapter reflects any proposals made for changes to the content of the code and does not attempt to be an assessment of the value of the current code.
p11, para 26, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 208 p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-The-Campaign-for-Press-andBroadcasting-Freedom.pdf 209 p15, part III, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/First-Submission-by-Sir-Louis-BlomCooper-QC.pdf 210 p11, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-CoordinatingCommittee-for-Media-Reform.pdf 211 p20, para 3.35, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1.pdf 212 pp, 8-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 213 p4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf 214 Part J, Chapter 5
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8.14

The Inquiry heard evidence from a number of academics with specific expertise in ethical issues who felt that the code could benefit from revision. Professor Chris Megone described the code as:215 “a code that has been developed primarily from the point of view of things that can go wrong in media practice. It has a view of ethics as something to be turned on in order to stop people behaving badly, rather than of ethics as being concerned more broadly with good judgement and a positive contribution to society.” He goes on to point out that the code is largely a series of prohibitions but that it is not very precise in terms of what is an absolute prohibition and where there is a prohibition that can be overridden. He says that ‘this imprecision is likely to lead to a certain laxity of interpretation’.216 His conclusion is that the code needs to be set more in the context of the specific critical contribution that a free press can make to the public interest, and that it should be developed in terms of the duties to the key parties with whom the relevant press interact in different ways.217

8.15

Dr Rowan Croft suggested that there would be merit in the code requiring proprietors, editors and journalists to declare their financial and political interests to their readers. Similarly, there could be a requirement for declaration to readers of any payment made or received for information relating to the publication of a story.218 This would help to give readers the information that they need in order to be able to accurately assess what they are being told in the newspaper. A number of the proposals suggest that more thought needs to be given to the meaning of ‘public interest’ in the context of the code. The Media Regulation Roundtable suggests that some guidance on how the code should approach the public interest should be set out in statute.219 Lord Prescott said that, though much of the code needs no amendment, there needs to be a wider debate on the definition of the public interest, in particular if it is to gain enhanced status as a defence in the courts.220 The Carnegie Trust agrees that understanding the public interest in the context of the code requires more thought and recommends ongoing research to understand citizens’ views on the matter.221 Lord Soley also raises issues of concern around both the definition of the public interest in the code and its application.222 This question of what is the public interest in the various different contexts in which it is used in relation to the press is, of course, a central one and is dealt with in detail at the start of this Report.223 Dr Neil Manson queries the effectiveness of the code provisions on accuracy:224

8.16

8.17
215

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pp10-11, para 9a-b, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-Statement-ofProfessor-Christopher-Megone.pdf 216 p11, para 9c, ibid 217 p13, para 11, ibid 218 p8, para 9a, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-Statement-of-Dr-RowanCruft.pdf 219 p11, para 28, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 220 p2, para 1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-led-byLord-Prescott.pdf 221 p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf 222 p7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Lord-Soley-of-Hammersmith. pdf 223 Part B 224 p16, para 9a, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-Statement-of-Dr-NeilManson.pdf

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“It is good that the Code places “The Press must take care not to publish inaccurate, misleading or distorted information, including pictures” to the fore. But, unfortunately, there is no account given of what constitutes accuracy, or distortion or misleading. This is, of course, problematic for it leaves considerable interpretative leeway in deciding what constitutes acceptable communication.” 8.18 Separately, Professor Manson queries the inclusion of the ‘public’s right to know’. The scope of the right is undefined, the nature of the right (a positive right to know or a negative right not to be prevented from knowing) is unclear and neither is practical. Professor Manson concludes that:225 “In any replacement code of practice there should be no mention at all of “the right to know” unless some decent argument can be given to show how it denotes a coherent right.” 8.19 Another issue that has been raised in relation to the code is the separation of fact and comment. Mr Eustice urges that the Code should be redrafted to strengthen the requirement to separate comment and fact. His specific proposals are:226 “A greater emphasis on this principle might be achieved by setting out in the code a presumption against using conjecture or opinion in a news story headline. It could also state far more clearly a presumption that opinion must appear in a separate editorial article and that, where practical, the basis for any conjecture should be sourced.” 8.20 A final point worth considering here is that the code itself, although important, can only achieve any improvement in standards if it is followed. The Inquiry heard evidence from many editors and journalists who claimed that the current code was the touchstone of their every decision. Doubtless in many (if not most) cases it is but, in the context of the extensive evidence the Inquiry has been given of behaviour in clear contravention of the code, this assertion can be taken too far and there is clearly room for improvement. The Inquiry has also been told many times that there is nothing wrong with the code, only with the enforcement of the code. Similarly, many industry witnesses told the inquiry that the problem was not with the self-regulation of the industry but with the enforcement of the law, as though the code did not prohibit illegal activity. In order to achieve anything the code needs not only to be well drafted, it must also be lived by the individuals and organisations to whom it applies. Professor Baroness O’Neill reflected that professional codes on their own have a limited efficacy, particularly where ‘professions’ lack powers or willingness to discipline their errant members. This, she says, sets limits to the effectiveness of any ethical codes adopted by parts of the media and means that ethical codes, while important, are not enough.227 She goes on to say:228 “traditionally ethical codes worked because they were embedded in cultural and social norms that were widely respected and adhered to, making shame and exclusion the principal sanctions for violations. Adherence to these ethical norms standards cannot be achieved in a scattered workforce, without entry requirements, agreed standards of practice, benchmarks of progression or ways of barring inadequate practitioners.”
p16, para 9a, ibid p6, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-George-Eustice-MP.pdf 227 pp7-8, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-Statement-of-ProfessorBaroness-ONeil.pdf 228 pp7-8, para 8, ibid
226 225

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8.22

Professor Megone suggested that:229 “to make a code a lived code, media organisations need to attend to the critical factors that can bring about an ethical organisation, or promote integrity in an organisation. These factors include tone from the top (or leadership), an open and honest culture, and so on.”

8.23

Dr Manson noted that:230 “where ethically problematic ‘cultures’ or sets of practices are entrenched, there may be no plausible ‘quick fix’……..However, it is a fallacy to argue from the fact that a quick fix is unavailable to the conclusion that nothing can be, or ought to be, done.”

9. Complaint handling
9.1 Complaint handling forms by far the largest part of the work of the PCC and a consistent and effective approach will be required in any new regulatory system. Two specific issues have arisen here. The first is by whom complaints should be resolved. The second is from whom complaints should be accepted. I look at the two in turn.

Who should adjudicate on complaints?
Internal complaint handling 9.2 The first point to address in this context is how complaints are handled internally by publishers and what has been described as the ‘outsourcing’ of complaints to the PCC. It seems clear that, under the existing PCC regime, few national publishers have effective mechanisms in place to deal with complaints from readers or others with concerns about their content; I have not taken sufficient evidence in relation to the regional and local press to know whether this holds true for them as well. There are beacons of good practice, and The Guardian’s ‘Readers’ Editor’ is the most developed that has been evidenced before the Inquiry. At one of the Inquiry’s opening seminars, Mr Dacre announced the creation of a corrections column in the Daily Mail231 and there have been suggestions that others might follow suit. However, as a general rule it appears that national publishers have been content for complainants to go directly to the PCC and are content for the PCC then to attempt to mediate the matter. Certainly the PCC protocols do not include encouraging bilateral resolution between the publisher and the complainant. This has two significant consequences. First, the PCC has a large workload of minor complaints that can be easily resolved by mediation and that could possibly be resolved more quickly, more easily and more cheaply on a bilateral basis. The provision of a central clearing house for this type of complaint makes little obvious sense. Second, there is a risk that editors may outsource the judgment over whether material they publish is compliant with the code, or its use is ethical, at the same time as they outsource the process of handling the complaint. Lord Black accepts that complaints should, in the main, be dealt with directly by the editor of the

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p13, para 11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-Statement-of-ProfessorChristopher-Megone.pdf 230 p19, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Witness-Statement-of-Dr-Neil-Manson.pdf 231 p3, Paul Dacre, Supporting a free press and high standards – approaches to regulation, seminar 12 Oct 2011, http:// www.levesoninquiry.org.uk/wp-content/uploads/2011/11/RPC_DOCS1-12374597-v1-PAUL_DACRE_S_SEMINAR_ SPEECH.pdf

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publication concerned, as that is likely to be the fastest way to resolve a dispute; the dispute should only then become a matter for the regulator when bilateral resolution is not possible. He argues that the changes to internal compliance systems inherent in his proposal should ensure that this would happen more often than it does now.232 9.4 The MediaWise Trust proposes that publishers should take a number of measures to strengthen in-house handling of complaints as part of a wider set of recommendations around re-building trust in the media:233

• • •
9.5

“An in-house but independent Reader’s Editor on every publication above an agreed circulation/ratings threshold; a regular Corrections column or programme, which might include review of the company’s own journalism; and a commitment to give suitable prominence to upheld complaints (and to offer compensation if appropriate).”

Lord Prescott made this point in his submission, commenting that complaints currently seem to be ‘outsourced’ to the PCC, making them seem distant from the ongoing operations of the newspaper in question. He goes on to suggest that the new system should look to see more complaints being resolved via the organisation’s internal mechanisms.234 I certainly agree that publishers should take more responsibility for their own compliance with standards and that having an effective and independent mechanism for dealing with complaints in-house is an important part of this. Complaint handling by a regulatory body

9.6

9.7

All of the proposals submitted to the Inquiry envisage complaints handling to be one of the key functions of their proposed regulatory body. Relatively few go into any detail about how, or by whom, those complaints should be handled. Lord Black’s proposal on behalf of the industry envisages a Complaints Committee comprising some serving editors and a lay majority. Although it is clear that, on the PCC, serving editors absent themselves from the process in relation to any decision on their newspaper, it is impossible to ignore the potential influence of a small number of extremely powerful individuals on the whole process. In section 8 above I set out the exchange that I had with Mr Richards of Ofcom about the propriety of including serving editors at any decision making level in a regulatory regime. His view, that allowing members of the regulated population any part in regulatory decision making is entirely inappropriate, applies at least as much in relation to complaint adjudication as it does to standard setting. The CPVs urge that adjudicators must be independent of Government, Parliament and the press, and that serving editors should have no role in the adjudicating or investigating bodies.235 Professor Greenslade said that retired editors would have ‘baggage’ and that they would not have up-to-date knowledge of the industry. He also

9.8

pp25-26, para 40-41, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Blackof-Brentwood1.pdf 233 pp9-10, para 2.06, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1. pdf 234 p11, para 11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-ledby-Lord-Prescott.pdf 235 p1, para 7.2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Joint-Submission-by-CoreParticipant-Victims1.pdf

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thought that the Press Council had tried co-opting retired editors and not found it to be productive.236 9.9 By contrast Mr Mosley proposes a statutory independent Tribunal to decide on all complaints, with each being decided by an individual adjudicator.237 Mr Mosley does not indicate any requirement for the adjudicator to have any, let alone current, media experience. Similarly the MST proposes a statutory regulatory body with the power to adjudicate over disputes, although only in relation to those publishers who choose to join the regime.238 An ombudsman approach? 9.10 A significant number of the proposals put to the Inquiry suggest what is described as an ‘ombudsman’ to handle complaints. The British and Irish Ombudsman Association (BIOA) sets out a number of criteria for ombudsman schemes. These cover independence, fairness, effectiveness, openness and transparency, and accountability. It is clear that none of the proposals submitted to the Inquiry actually envisage a body with the independence that would be required for it to be recognised as an ombudsman by BIOA, as they generally draw their authority from a self-regulatory industry body without an obvious guarantee of independence. It should, perhaps, be noted here that, although many of the proposals draw on the Irish Press Ombudsman as an analogy, the BIOA does not recognise the Irish Press Ombudsman as fulfilling their definition of an ombudsman because there is not a clear separation between the ombudsman and the Press Council in terms of appointment, reporting and appeal; the BIOA consider that regime to be a complaint handling scheme only.239 The main thing that distinguishes these proposals from that of Lord Black is that they envisage adjudications being made by a single person, not a committee, and do not rely on current media experience. Lord Prescott advocates the establishment of an ombudsman. Complaints could only be taken to the ombudsman once the company’s internal mechanisms had been exhausted; the ombudsman would then encourage a quick and mutually agreed solution but should be able to adjudicate on the complaint where necessary.240 The ombudsman could be asked to look at matters which might otherwise be the subject of civil litigation. There would be no requirement on complainants to use the ombudsman, but courts might take a decision to side-step this option into account when considering a case. Similarly, the courts could consider the decision of the ombudsman if this channel was used.241 The Carnegie Trust suggests the appointment of an ombudsman to investigate and adjudicate on complaints because of the perceived benefits of independence, public profile, trust and effectiveness.242 Similarly, the MediaWise Trust recommends the creation of an ombudsman. As in other models, the complaint would first have had to be considered bilaterally with the publisher.

9.11

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p27, lines 7-23, Professor Roy Greenslade, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-12-July-2012.pdf 237 p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 238 pp3-4, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 239 p57, lines 1-15,David Thomas, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-12-July-2012.pdf 240 p11, para 11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-ledby-Lord-Prescott.pdf 241 p12, para 11, ibid 242 p7, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf

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The ombudsman would seek to resolve the matter swiftly and to the satisfaction of all parties, and could arrange oral hearings or conciliation meetings if appropriate.243 9.12 The BIOA concluded that there is a role for a press ombudsman scheme as part of a proportionate system of checks and balances and provided its own set of proposals as to how a genuinely independent press ombudsman scheme might work. The BIOA notes that there is no current ombudsman scheme appropriate to take on the role, so a new scheme would be required. Specifically, and among other things, it recommends:244 “the name ‘ombudsman’ should not be used unless the body complies fully with the BIOA criteria for ombudsmen; any ombudsman scheme should be constituted as an independent body entirely separate from any regulatory body; any ombudsman scheme should have an independent board of directors, appointed on terms that secure their independent from those appointing them; Board members should not be appointed by a body which has more than minority representation from the industry, and not more than a minority of the board members should be from the industry; the independent board should appoint the ombudsmen, on terms that secure their independence from those appointing them; the scope and powers of any ombudsman scheme should be set independently, in the public interest, and not set by ‘negotiation’ with the industry; any ombudsman should be operationally independent, so that no regulator or industry body has any influence on its approach and decisions; the funding arrangements should ensure sufficient resources for the workload, and not provide any lever for the industry to try and exert any influence over the ombudsman’s approach.”

Who can make a complaint?
9.13 The position with respect to who can make a complaint to the PCC is set out earlier in this Report.245 Very few of the proposals submitted to the Inquiry deal explicitly with this issue. The Carnegie Trust recommends that the ombudsman should be able to take complaints from any concerned citizen, not merely from those directly affected by the article in question.246 The CPVs argue that complaints should be able to be brought by the subject (or intended subject) of the publication or by third parties.247 The NUJ urges that those impacted collectively should be able to complain and seek a right of redress.248

p19, para 3.31-3.33, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1. pdf 244 pp15-16, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-British-and-IrishOmbudsman-Association.pdf 245 Part D, Chapter 2 246 p7, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf 247 p1, para 7.2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Joint-Submission-by-CoreParticipant-Victims1.pdf 248 pp3-7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf

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9.14

Mr Dacre expresses concern at the idea, set out in the Inquiry’s published draft criteria for an effective regulatory regime, that third party complaints might result in ‘credible remedies’. He argued that this could:249 “open a Pandora’s box of problems with every lobby and fringe pressure group in Britain (and abroad) deluging the regulator with complaints which may often be politically or ideologically motivated and aimed at forcing newspapers to report events in a way that furthers the group’s objectives.” His proposal is that the standards body should be able to take third party complaints, at their discretion, but only with a view to formulating a judgment that could result in changes to the code.250

9.15

The BIOA raise a concern that the wider complainant eligibility is drawn, the greater the burden on business and any ombudsman scheme, and the greater the chance that some cases might be brought for ‘campaigning’ rather than redress reasons. The solution proposed by the BOIA is that it might be open to representative groups to bring a complaint, but that should be subject to some requirement for ‘permission’.251 The same type of hurdle (whatever the scheme) might avoid the problems which concerned Mr Dacre.

Standards: investigatory powers
9.16 The purpose of a complaints handling mechanism is to deal with issues as they affect an individual: it could be considered as loosely analogous to the remedies available through the civil law, where the point at issue is the impact on the individual. A regulatory body, as opposed to a complaints handler, would also have an interest in the maintenance of standards for their own sake: this could be considered as loosely analogous to the criminal law, where the focus is on the maintenance of minimum standards and the determination of an appropriate sanction if that standard is not met. So it is not enough that the regulatory body should have the power to deal with complaints; it also needs to have the power to consider compliance with standards and to take action where standards are systemically or significantly breached, irrespective of whether a complaint has been made in respect of the breach. The PCC has been widely described as a good complaints handler but not a regulator. The key to the ability of the regulator to take action in relation to systemic or significant breaches is the power to investigate potential incidents. The failure of the PCC to use any investigatory powers that it might have had in relation to phone hacking has led a number of witnesses to emphasise the need for a new system to include investigatory powers. Lord Black’s proposal on behalf of the industry sets out details for a standards and investigatory arm that would have the power to carry out investigations in respect of significant, systemic breaches. This proposal is described and analysed earlier in the Report252 but is worth noting when considering the other proposals that have been made with regard to investigatory powers. Where the issue is addressed explicitly by proposals, there is unanimous support for a regulatory body having investigatory powers. Lord Prescott advocates that the regulatory

9.17

9.18

9.19
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p8-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf p8-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Paul-Dacre1.pdf 251 p12, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-British-and-IrishOmbudsman-Association.pdf 252 Part K, Chapter 3

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body should have the power to appoint a suitably skilled investigator, at the regulated firms’ expense, to address questions that the regulator may have.253 Sir Louis Blom-Cooper QC argues for a statutory power for a regulatory body to hold public inquiries into ‘any press activity that has aroused, or is likely to arouse, public concern’.254 Mr Suter says that the self-regulatory bodies must have ‘adequate powers’ including at a minimum the power to investigate broader or systemic problems.255 Professor Greenslade proposes giving a power to investigate to a media ombudsman who could investigate where there is evidence of systemic breaches of the code.256 The Media Regulation Roundtable says: 257 “In addition, the MSA would have the power to investigate apparent breaches of the MSA Code by participants without a specific complaint having been made by a member of the public.” 9.20 Ofcom supports the introduction of a power to investigate but warns:258 “Ensuring powers of investigation are only available post publication would be consistent with preserving the independence of the press and rights of free expression.” 9.21 It seems to me entirely right that any press standards body should have both a duty to maintain standards and the power to initiate its own investigations, in particular in respect of concerns relating to systemic or significant standards breaches. It is entirely conceivable, especially in privacy cases, that the subject of a story may not wish to draw more fire upon his head from an offending publication by making a formal complaint. This should not prevent a standards body from carrying out whatever investigation is necessary to identify whether there has been a breach of standards and, if so, applying the appropriate sanction. One approach might be to give the standards body the power (in appropriately serious cases) to bring a complaint in relation to a specific article, albeit allowing the complaint handling process to take account of the failure of the affected party to complain. Further, in relation to complaints by groups, although I have recognised the concern expressed by Mr Dacre and would endorse a filter system to remove complaints that are ideologically motivated only to further the group’s objectives, I do not otherwise accept the argument. As I have pointed out earlier259 the current Editor’s Code outlaws prejudicial or pejorative reference to an individual’s race, colour, religion, gender, sexual orientation or to any physical or mental illness or disability, but does not provide similar protection in respect of groups. It is difficult to understand why there should not be some mechanism for representative groups to engage in challenges similarly based on the standards set out in the code. In addition, I see no reason why representative organisations should not be entitled to raise a complaint in relation both to accuracy and prejudice where articles are discriminatory in respect of a group. Where such articles are found to have breached the relevant standards

9.22

9.23

p12, para 12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-ledby-Lord-Prescott.pdf 254 p16, part III, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/First-Submission-by-Sir-Louis-BlomCooper-QC.pdf 255 pp3-4, para 17, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Tim-Suter-ofPerspective-Associates.pdf 256 p12, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 257 p14, para 37, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 258 p8, para 4.3 e, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 259 part D, chapter 2

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to the level that can trigger a standards investigation, it should be possible for the standards body to impose whatever sanctions or redress they would normally impose in respect of a breach of standards. 9.24 A number of proposals mention that individuals should be able to have complaints dealt with without incurring costs. This is an important point, and nobody has suggested otherwise. I entirely agree and applaud the fact that this has been one of the high points of the way in which the PCC has operated.

10. Remedies and redress
10.1 For this purpose I draw a distinction between ‘remedies’ or ‘redress’, the primary purpose of which is to make good, or compensate for, the harm done to another party and ‘sanctions’, the primary purpose of which I take to be punishment for breach and should impact primarily on the wrongdoer. For example, in a system with a regulator and an independent ombudsman, the ombudsman would be interested in redress and might require a company to pay compensation to an individual who has suffered at a level that reflects their loss, whilst the regulator might, in respect of the same breach, impose a fine, the level of which is designed to demonstrate the severity of the breach. The proposals considered in this section refer to redress and remedies that might be awarded by a regulatory complaints body for breach of a code of standards, not to any redress or remedies that might be awarded in respect of breach of civil rights. That is dealt with in the section below on dispute resolution. The only remedy currently open to the PCC is to require a correction to be published, and the only redress is the publication of an apology, both with the placing and prominence to be agreed between the publisher and the PCC. Under the proposals submitted by Lord Black, this position on remedy and redress for those who have been harmed by press misconduct would remain unchanged. The Campaign for Broadcasting and Press Freedom takes a similar approach to redress but advocates a dedicated section on the editorial page to carry corrections, clarifications and apologies.260 A substantially wider range of remedies and redress have been put to the Inquiry in the proposals for the future. The CPVs argue that the press adjudicator should have the power to make compensatory awards, to require the publication of corrections, and to determine the prominence given to such corrections.261 Most, but not all, of the CPVs also consider that an adjudicator should have the power to prevent publication similar to an injunction.262 Mr Mosley specifically advocates all of those powers as well as proposing that the Tribunal should have the power to order newspapers and photographers to leave a complainant alone, ban the use of photographs, and order an item to be removed from the internet.263 Lord Prescott proposes that a press ombudsman should have the powers to:264

10.2

10.3

10.4

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pp5-6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-The-Campaign-for-Pressand-Broadcasting-Freedom.pdf 261 p2, para 7.6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Joint-Submission-by-CoreParticipant-Victims1.pdf 262 p2, para 7.7, ibid 263 p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 264 p11, para 11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-ledby-Lord-Prescott.pdf

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“obtain[..] prompt equal-prominence corrections to quickly limit harm and/or redress the damage inflicted on the individual; award[…] damages, which are significantly material to genuinely recognise the distress and suffering caused to the complainant;” 10.5 Similarly, the Carnegie Trust says that a press ombudsman should have the power to require news providers to issue prompt and prominent corrections and apologies for factual errors or misleading articles, and award compensation if appropriate.265 The BIOA considers that any ombudsman should be able to award redress (up to a specified monetary limit) and/or require the business to take specified steps in relation to the business. The decisions of the ombudsman should be binding on the business.266 Ms Harman considers that the regulator should have the power to order the prominence and wording of an apology,267 as does the NUJ,268 while Mr Eustice says they should be able to dictate the size and prominence of corrections.269 Ofcom suggests that a strengthened self-regulatory system might have strong rules in relation to equal prominence of apologies and corrections, with determination by the regulator rather than as part of a process of negotiation with editors.270 The MediaWise Trust says that: “breaches of the new code should be dealt with like any other violation of professional standards or human rights – with appropriate sanctions, including compensation for the victims.” 271 In addition they argue that the costs of successful complainants should be met, within a modest cap.272 The Campaign for Media Reform also advocates the regulator having the power to award compensation,273 as does the Media Reform Roundtable.274 10.8 Sir Louis Blom-Cooper acknowledges some concerns around giving a regulator the right to dictate the wording and/or placement and size of a correction or apology, on the grounds that this might constitute an infringement of the right to freedom of expression. By way of authority he refers to the Supreme Court of the United States in Miami Herald v Tomillo,275 which held that a statutory right to reply to a newspaper article was an interference with editorial freedom and hence contrary to freedom of the press under the First Amendment to the US Constitution. By way of contrast, however, he also pointed to the decision of the European Human Rights Commission in Ediciones Tiempo v Spain,276 which rejected a

10.6

10.7

p8, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf p16, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-British-and-IrishOmbudsman-Association.pdf 267 p4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf 268 pp10-11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 269 p5, para 1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-George-Eustice-MP.pdf 270 p8, para 4.3 f http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 271 p20, para 3.35, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1.pdf 272 pp20-21, para 3.40-3.41, ibid 273 p13, Campaign for Media Reform submission p13 ‘Fines and compensation’ http://www.levesoninquiry.org.uk/wpcontent/uploads/2012/07/Submission-by-Coordinating-Committee-for-Media-Reform.pdf 274 p13, para 34-35, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-MediaRegulation-Round-Table.pdf 275 418 US 2141 (1974) 276 62 D+R 247 (1989)
266

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challenge to a right of reply provision in Spanish law on the grounds that the editor had plenty of opportunity to publish his own version of events so that the marketplace of ideas was enhanced, not contracted.277 10.9 It seems to me that there is no rationale for allowing the publisher to have some kind of veto over the wording, placement or prominence of a correction or apology made as a result of a code breach. These are matters which a regulatory body should have the power to dictate. Whether or not it is appropriate for the regulatory body to have powers to award compensation to complainants might depend on the relationship between the regulator and any dispute resolution system.278

11. Sanctions
11.1 Sanctions are a vital part of any effective standards regime. Sanctions must obviously be proportionate, but a regime will have limited impact if the sanction for breach is not sufficient to incentivise compliance. Ofcom refers to the important of effective powers of enforcement and sanction as:279 “a genuine deterrent both to the party being punished and as a warning to other regulated parties.”

Negative comment
11.2 The only sanction available to the PCC currently is to reach an adverse adjudication and require its publication.280 The proposal by Lord Black on behalf of the industry would continue to restrict the complaints body to adverse adjudication, and the publication of a correction or apology, in respect of individual complaints. He also proposes that the standards body be given the power to investigate in a way that could result in the imposition of fines in relation to serious or systemic breaches. Sir Louis Blom-Cooper proposes a system entirely based around the publication of report on specific topics and outcomes from public inquiries into media malpractices. This, he argues, would inform the public and wield influence, rather than power.281

11.3

Fines
11.4 Despite the apparent general acceptance by the industry of the need for a self-regulatory standards body to have the power to levy fines, this is not accepted without question by everybody. Sir Louis is worried that too high a fine might impact on the ability of a journalist, editor or publisher to continue to practice, and thus impinge on the right to freedom of expression.282

K

p12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/First-Submission-by-Sir-Louis-Blom-CooperQC.pdf 278 This is discussed in Part J Chapter 4 para 5.10 279 p6, para 2.4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 280 and reporting to the publication’s owner, but that is a lower sanction even than adverse adjudication 281 P15, Part III, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/First-Submission-by-Sir-Louis-BlomCooper-QC.pdf 282 p11, part II, ibid

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11.5

Lord Prescott argues that the regulatory body must have financial penalties as a tool at its disposal. He recognises that in a voluntary body it might be difficult to secure agreement on the power to levy fines, but nonetheless (as noted above) takes the view that the body should have the power to award damages.283 On the other side of the argument, the CPVs,284 Ms Harman,285 Mr Eustice,286 the Carnegie Trust,287 the MediaWise Trust,288 the NUJ,289 the Campaign for Media Reform,290 Max Mosley,291 Professor Greenslade,292 Ofcom,293 and the Media Regulation Roundtable294 are clear that the regulator should have the power to levy fines. The MediaWise Trust is severe about the efficacy of the power of adverse adjudication, saying:295 “the new system will need genuine sanctions rather than the current fiction that peer pressure alone maintains standards. Breaches of the Code should be treated serious and persistent breaches should be dealt with severely. Editors whose newspapers have been found in breach of their own Code have in the past, remained in post or been ‘promoted’ or even remain on the PCC or the Editors’ Code Committee. It is not surprising that such a system is viewed with contempt.”

11.6

11.7

I am inclined to agree. It is important that any new press standards regulatory body should have sufficiently strong sanctions to provide an incentive to press to comply with agreed standards. I do not find it credible that the power of negative adjudication on its own provides that and it seems sensible that the regulator should have the power to levy proportionate fines. Given Lord Black’s proposals in this area I do not expect this to be a very controversial conclusion. The Carnegie Trust notes that in a voluntary system the ultimate sanction is expulsion from the system, with whatever benefits might have accrued from being in the system.296 This is, of course, only a sanction of any significance if membership of the system carries significant benefits and is inappropriate for a system whose strength is intended to be its inclusivity of all. Mr Eustice proposes a higher level of sanction, arguing that Ofcom should be given the power to ensure that the internal governance systems of newspapers are such as to allow them to

11.8

11.9
283

p11, para 11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-ledby-Lord-Prescott.pdf 284 p2, para 7.6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Joint-Submission-by-CoreParticipant-Victims1.pdf 285 p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf 286 p5, para 1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-George-Eustice-MP.pdf 287 p8, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf 288 p20, para 3.35, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1.pdf 289 pp10-11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 290 p13, Campaign for Media Reform submission p13 ‘Fines and Compensation’ http://www.levesoninquiry.org.uk/wpcontent/uploads/2012/07/Submission-by-Coordinating-Committee-for-Media-Reform.pdf 291 p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 292 p12, para 9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 293 p8, para 4.3f, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 294 p14, para 38, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 295 pp19-20, para 3.34, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1. pdf 296 p8, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf

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comply with the code and the law.297 Mr Eustice does not specifically say that Ofcom should be able to fine newspapers for failure to comply but, given the nature of Ofcom’s current regulatory powers, that must be the logical inference; in truth, there is no other ultimate sanction.

12. Dispute resolution
12.1 The sections above dealt with breaches of a standards code. This section deals with breaches of civil rights by media organisations. It is a fact that many, but by no means all, complaints relating to a breach of a press standards code will be in respect of breaches that potentially give rise to an action in tort. The question must therefore arise as to whether such issues should be considered as code breaches, breaches of civil rights or both. The PCC has historically taken the view that it will not consider a complaint that is the subject of legal action, and that any complaint will be suspended pending the outcome of legal action should action be commenced after a complaint has been made. Complainants can, and sometimes do, take legal action following resolution of a case by the PCC. The PCC complaints system is free and can by relatively quick. Taking action through the courts, by contrast, is both extremely slow and can be extremely expensive. Many of those proposing ways forward on standards to the Inquiry have, either as a part of their proposed solution or as the foundation of it, proposed the creation of an alternative to the courts to settle civil cases involving the media. The establishment of an alternative dispute resolution mechanism is straightforward enough. There is nothing now to stop that happening: indeed, the Inquiry heard evidence from Sir Charles Gray in relation to Early Resolution, which has done just that, although as noted earlier it has not proved popular so far with claimants. The issue is not how to ensure that such systems exist, but how to make them sufficiently attractive to the press so as to encourage them to be part of a regime that provides access to them, and equally attractive to those who wish to commence proceedings against the press. The issues around civil litigation are examined in detail elsewhere in the Report298 and I do not propose to revisit them here. In this section I will simply consider the proposals that have been put forward to deal with them. Lord Black suggests the possibility of establishing an ‘arbitral arm’ as a part of the model he proposes on behalf of the industry. However, this proposition is not worked up in any detail. It is clear that the value to the industry from this proposal would come principally from the ability to require complainants to use it. The Alternative Libel Project submitted a proposal based around a new press regulator offering a voluntary arbitration service. The key elements of their proposal are: 299 (a) “increased use of mediation and arbitration; (b) the introduction of Early Neutral Evalation;
297

12.2

12.3

12.4

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pp5-6, para 2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-George-Eustice-MP. pdf 298 Part J, Chapter 3 299 p2, para 1.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Alternative-LibelProject-English-PEN-and-Index-on-Censorship.pdf

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(c) Costs penalties for failing to use these three forms of alternative dispute resolution (d) the introduction of a hearing to determine the meaning of an alleged defamatory statement, with fixed limits on evidence, argument and costs; (e) more robust case management; (f) a change in costs rules to protect a party from having to pay the other side’s costs in the event of losing, and the introduction of an overall costs cap.” 12.6 Under this model the regulator could offer a mediation service, with any unsettled cases going on to court, an adjudication service, or an arbitration service where the findings would be final.300 The Alternative Libel Project supports voluntary ADR as part of a self-regulatory scheme which should be incentivised by costs orders made by the courts.301 They take this line because compelling people to use ADR would involve some form of statutory underpinning, which is opposed by Index on Censorship and English Pen as a form of statutory regulation.302 By contrast Sir Charles Gray and Early Resolution submitted to the Inquiry a proposal founded on a statutory adjudication scheme which both claimants and defendants are required to use. Early Resolution (ER) is a not-for-profit company set up in 2011 for the specific purpose of helping those engaged in expensive and complex libel or privacy litigation.303 The Objective of ER is to bring about a fair, rapid and cost-effective resolution of disputes involving the media.304 Where both parties agree to arbitration, ER can resolve issues including, in relation to defamation the meaning of the publication complained of, whether the words are statement of fact or comment and the quantum of any damages. In relation to libel, ER can determine whether the defendant had infringed the claimant’s right to privacy, and, if so, to what extent, whether the defendant had a defence of public interest and any damages.305 The benefits of this scheme are described as its speed, privacy and cost effectiveness.306 Sir Charles’ proposal would be for a statutory regulator operating mediation for breaches of its code and statutory adjudication for disputes involving a claim for compensation.307 Under this system both claimants and defendants would be compelled to participate in the adjudication process.308 Hugh Tomlinson QC’s proposal on behalf of the Media Regulation Roundtable postulated a fully integrated regulatory and ADR regime. Under this scheme, like the ER proposal, all complaints against scheme members would go to the regulator in the first instance. A complaint in relation to a breach of the code would be the subject of mediation and could then go to a dispute resolution tribunal if the claimant was not satisfied. A complaint of a legal wrong would also start with mediation but, if that was unsuccessful, would then go to a compulsory adjudication process. Any attempt to bypass the adjudication system by going straight to court would result in the court action being stayed. The adjudicators would operate a stringent filter to prevent vexatious or hopeless cases being brought. The case would be ruled on within 28 days and could be dealt with on the papers or after an oral

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300 301

pp2-3, paras 1.3-1.4, ibid p3, para 1.7, ibid 302 p3-4, para 1.9, ibid 303 p1, para 1.1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Early-Resolution.pdf 304 p1, para 1.2, ibid 305 p1, para 1.5, ibid 306 p1, para 1.6, ibid 307 p12, para 9.2, ibid 308 p12, para 9.3, ibid

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hearing. The adjudicator’s ruling would not be final or binding and could be challenged in the courts.309 12.10 Mr Mosley’s proposal would establish a Press Tribunal which would have jurisdiction in parallel with the High Court in respect of media cases. The Tribunal would operate by hearings in front of a single adjudicator, at very short notice if necessary. Lawyers would not be involved unless the complainant appointed one. The adjudicator would have no power to make orders for costs other than for wasted costs, but would have the power to award damages. Because the Tribunal would be operating as a regulator as well as an adjudicator it would also have regulatory sanctions and remedies available to it.310 12.11 There is much to be said for an effective alternative dispute resolution mechanism that must be used by both complainants and defendants. I am struck by Sir Charles’ experience that complainants at present are not incentivised to use an ADR mechanism. That may well change with changes to the conditional fee agreements (CFAs). But making it more difficult for complainants to use CFAs will put the balance of power firmly back with the newspapers when it comes to court action, making an alternative route to justice of critical importance for ordinary individuals.

13. The role of the courts
13.1 Many of the proposals presented to the Inquiry envisage a role for the courts in some way. For the most part, this is related to the extent to which the courts could take into consideration any membership of a self-regulatory body when considering defamation and privacy cases, and the relationship between the courts and any ADR mechanism. I have considered both of these issues thoroughly in sections 5 and 12 respectively of this Chapter and I do not propose to revisit them here. A few of the proposals envisage the courts having a role in enforcing the decisions of the regulatory body. Lord Black’s proposal on behalf of the industry relies on contacts between the regulator and the regulated for enforcement of any regulatory decisions. The only mechanism for enforcement in that situation is to seek an order from the courts for specific performance. Similarly the Media Regulation Roundtable proposal suggests that the power to apply sanctions would sit in a contract between the regulator and those regulated,311 and the regulator would therefore similarly have to rely on the courts to enforce a sanction if the other party refused to comply voluntarily. The Campaign for Broadcasting and Press freedom suggests that its proposed regulator should be able to apply to the courts for an order to enforce a ruling about publication of a correction or apology.312 Similarly Ms Harman envisages the courts enforcing fines for failure of a newspaper to comply with a ruling by a new regulatory body.313 In practice, there would be a potential enforcement role for the courts in relation to any statutory provision. In addition, the decisions and actions of any

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P23, para 81, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 310 p3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 311 pp3-4, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 312 pp5-6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-The-Campaign-for-Pressand-Broadcasting-Freedom.pdf 313 p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf

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statutory body would be subject to judicial review unless some other appropriate appeal mechanism was specifically provided for in the statute.

14. Costs and funding
14.1 Any new regulatory regime will have costs and those costs will have to be met from somewhere. This gives rise to three separate questions. The first is simply affordability. How much will it cost, can adequate resources be found and, from where? The second is about adequacy. Any regulator can only be as effective as its resources allow it to be, so how can a new system ensure that the regulatory body has sufficient funding to act effectively, particularly recognising that all private and public sector budgets are under pressure in the current economic circumstances? Third, how can the regulator maintain genuine operational independence from its funding body or bodies? This encompasses the obvious point that a regulator should not be put under financial pressure in relation to any individual decision or decisions, but also that a funding body should not be able to influence the regulator’s overall approach in terms of how it organises its activities, sets its priorities or approaches its duties. This section is concerned only with the costs of a regulatory function (including complaint handling) and does not include any consideration of litigation costs in relation to dispute resolution.

How much will it cost?
14.2 The only proposal presented to the Inquiry with any estimate of the cost was that of Lord Black. He estimated that the industry proposal would cost £2.25m per annum, together with (un-estimated) one-off transitional costs.314 Lord Black made it clear in oral evidence that this was an estimate and that clarity over costs remained an important issue for the industry. However, he said:315 “As always with the industry, if there is a case that is made out that more funding is needed, then the industry has always met it in the past. I think that we would need to sit down with the new regulator when that’s in place, when we have further costings, and look at these elements and how much they’re going to cost, but I have no doubt that sufficient funding will be made available to the regulator to fulfil its function.” 14.3 The MST helpfully calculates that the cost of the PCC and Pressbof in 2011 (just over £2m) amounted to approximately 0.05% of copy sales revenue for nationals and 0.13% for regionals.316 The MST also helpfully provides information on the costs of other self or coregulators in the UK and other press councils around the world, but I fear that this information is limited in value unless there is a clear comparison between the models. I have dealt above317 with suggestions that the PCC was unable to be effective because it was not sufficiently funded. Without being able to give a view myself on what level of funding would be appropriate for any particular model put forward I certainly would make that point that any system must be adequately funded to carry out all of its functions.

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p45, para 94, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 315 p73, lines 2-9, Lord Black, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-MorningHearing-9-July-2012.pdf 316 p118, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf 317 Part D, chapter 2, paragraph 8.4

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Who should pay?
14.5 The first point to make is that none of the proposals presented to the Inquiry suggest that complainants should directly bear any part of the cost of a new regulatory regime. The NUJ expresses the point explicitly:318 “The body needs to be free for users at point of access so that there is no financial impediment to complaints about standards. The one small bit of praise for the PCC that is constantly and justly repeated is that it is fast and free. These are attributes that need to remain in a successor regulator…...” The MediaWise Trust points out that, whilst there is no fee to access the PCC’s services at present, it cannot be considered to be ‘free’ to do so because the costs of, for example, securing professional advice, or obtaining transcripts of inquests or court cases, can be significant.319 Mr Mosley argues that it is essential that a tribunal should be available to both public and media free of charge.320 14.6 Lord Black makes it clear that his proposal would be fully funded by the industry. Indeed, he goes further and says that:321 “It would be inappropriate in a system of self regulation for the taxpayer to make any contribution through state funding, and the industry is – to the best of my understanding – wholly opposed to that.” 14.7 Others agree that the industry should be responsible for the full cost of a new regulatory system. Ms Harman considers a circulation based levy on publications.322 Mr Mosley, who also proposes the establishment of a statutory tribunal, proposes that it should be funded by a combination of fines levied on companies and:323 “A levy of ‘less than 1p (possibly as little as 0.1p) for every copy distributed of any publication with a circulation exceeding 30,000.”324 The Campaign for Press and Broadcasting Freedom argue for a levy on advertising revenues generated by the activities of the relevant groups. The levy would take into account the varying capacities of organisations to pay as well as overarching principles of fairness. 14.8 Mr Mosley asserts that a 1p levy on newspaper distribution would raise about £47.5m annually. Professor Greenslade says that publishers who sign up to the system will provide funds proportionate to the size of their circulations.325 The MST proposes a levy on all large news publishing organisations of 0.05% of revenues in order to fund its proposed Backstop

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pp3-7, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 319 p20, para 3.36, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1.pdf 320 p4 and p9, para 23, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley. pdf 321 p20, para 26, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf 322 p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf 323 p6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-The-Campaign-for-Press-andBroadcasting-Freedom.pdf 324 p4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Max-Mosley.pdf 325 p15, para 13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf

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Independent Auditor.326 The self-regulatory bodies would be (transparently) funded by members’ subscriptions.327 14.9 There is a significant body of opinion that state funding of some sort should be provided. This is particularly the case where the proposals envisage some form of statutory authority or powers for the new regulatory body. This ranges from those who would like to see a mix of public and industry funding to those who advocate a fully state funded solution.

14.10 The Carnegie Trust anticipates that the new regulatory regime is likely to be significantly more costly than the current regime and that the full cost should not be met by the industry:328 “Given the challenging economic and market conditions facing the newspaper industry at present this could have a detrimental effect on the sustainability of a number of news outlets – and this is not in the interests of citizens.” The Trust therefore suggests that the industry should pay some of the increased cost of a new system but that there should also be additional public funding to support the activities of the new regulator.329 Similarly, the MediaWise Trust advocates a mix of public funds and contributions from the print and broadcasting companies, saying:330 “Just because public money is involved doesn’t mean that control transfers to politicians.” 14.11 The NUJ tends towards the view that state funding may be the easiest way to ensure true independence, but also canvasses the idea of charging the companies complained of a case fee, with surcharges where complaints are upheld,331 although agreeing that one would have to be very careful about frivolous complaints. In giving oral evidence to the Inquiry Professor Frost said:332 “it’s certainly a possibility that if the new body became concerned that newspapers were wilfully ignoring complaints that had come to them first, that they could charge a fee, but I have to say it’s not my favoured option. I don’t think we would want to push that. It would be much more sensible for the new body to be funded either from the industry or from state funds or a mix of the two.” 14.12 The CCMR, having recommended the establishment of a statutory tribunal, suggests that funding of the Tribunal should be through the courts and tribunals system.333 14.13 The Media Regulation Roundtable expects most funding to come from subscriptions from publishers joining their voluntary scheme. They also advocate the ‘polluter pays’ principle, suggesting that those who breached the code would be expected to make enhanced contributions. Finally, they note that it is likely that an element of state funding will also be required, in particular to cover start up and transition costs.334 Sir Louis Blom-Cooper
p75, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-Standards-Trust.pdf p66, ibid 328 p8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Carnegie-Trust.pdf 329 p8, ibid 330 p22, para 3.49, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-MediaWise1.pdf 331 pp8-10, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 332 p95, lines 12-19, Professor Chris Frost, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Morning-Hearing-10-July-2012.pdf 333 p13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Coordinating-Committee-forMedia-Reform.pdf 334 pp16-17, paras 53-55, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-MediaRegulation-Round-Table.pdf
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envisages that ‘substantial public funding’335 would be required for his vision of a statutory independent Press Commission. 14.14 It seems to me that a pragmatic solution is probably called for. It is important that the funding for any new system of press standards regulation should be sufficient to enable the job to be done properly. The press currently makes a contribution of just over £2m a year to fund the PCC and I can certainly see no reason why they should be called up on to pay any less towards a new system. I do, however, recognise that some parts of the industry are facing significant economic and market challenges and it is important to keep the burden on companies to a realistic and appropriate minimum. I see no objection in principle to public funds being used to help establish or run any system of regulation that depends on statute, although equally there is no reason why the industry should not meet the costs of any statutory regulation in this sector as they do in many others. Ultimately this must be a matter of judgment for the Government, having regard both to what is fair and to the ability of the industry and the public finances to contribute.

Adequacy and independence
14.15 Ofcom argues that:336 “Ensuring reasonable operational independence and appropriate scope could be best achieved through the application of fixed term funding settlements.” Elaborating on this point in oral evidence Mr Richards made the point that a regulatory body requires financial security in order to be truly independent of its funding body:337 “If you have established to public satisfaction, as it were, all of the things that Colette was talking about a few moments ago, in other words your governance and independence framework, that in reality is not going to go very far if actually someone is controlling the purse strings on a regular basis and in effect can infer or imply that resourcing or money may be withheld or changed in one form or another should decisions be made which are not the ones that may be preferred, and I think this is extremely important. I think a very important dimension of independence and effectiveness is financial security. You can’t have an in perpetuity arrangement, and I think we suggest a multi-year period, I think we might mention somewhere three or four years, such that there is a moment when a proper exercise takes place which asks what is the necessary funding for the body? And that’s about efficiency and value for money. But after that, there should not be interference with that budget, to ensure that the operational daily decision-making is not subject to any risk, any risk of threat or intimidation or anything of that kind.” 14.16 The difficulty of ensuring independence of the regulator from the body funding it was made by Professor Greenslade:338 “If you just take funding, for a start. Funding is not a sort of joke thing. If you pull that lever, you constrain that lever, you control. And so I would be really worried about the
p19, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/First-Submission-by-Sir-Louis-Blom-CooperQC.pdf 336 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Covering-Letter-from-Ofcom.pdf 337 pp86-87, lines 14-10, Ed Richards, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-12-July-2012.pdf 338 pp41-42, lines 21-5, Professor Roy Greenslade, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-12-July-2012.pdf
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industry funding board aspect [of Lord Black’s proposal]. It seems to me it’s PressBoF reborn, and I think that’s a problem. I thought his phrase about independently led self-regulation was beautifully put. It’s actually in his submission too. But what we’re really aiming for, are we not, is independently led independent regulation.” 14.17 Mr Suter proposes a model in which regulation is carried out by approved self-regulatory organisations. In recognition of the importance of maintaining the independence of the regulator from its funding body, he suggests that one of the three essential criteria against which a self-regulatory body should be assessed should be that the operational and funding arrangements are sufficient to fulfil their role.339 14.18 I agree with Mr Richards and Professor Greenslade on this point. It is essential that any new regulatory body should have both security and independence of funding. I agree that this will mean that fixed term funding agreements should be reached to enable the regulatory body to manage its affairs as it sees fit without undue pressure or interference from the funding body, whether the funding comes from the industry or from Government, or both.

15. Protection and promotion of freedom of expression
15.1 A number of the submissions put to the Inquiry suggest that any new regulatory regime should include a positive role in relation to protection and promotion of freedom of expression or freedom of the press. Ofcom starts from the position that there should be a clear statement of the public purposes of any regulatory system, and that the first of those purposes should be:340 “a requirement to protect the rights of the press in relation to freedom of expression.” The Campaign for Press and Broadcasting Freedom proposes that the aims of its proposed Media Standards and Freedom Council should include:341 “To promote both the free dissemination of news and information in the public interest, and professional and ethical standards.” The CCMR proposes that the Board of its News Publishing Commission would have a responsibility to monitor and champion press freedom.342 The MST identifies six key objectives for its proposed Backstop Independent Auditor, one of which is to protect and promote reporting in the public interest.343 15.3 Mr Tomlinson QC, on behalf of the Media Regulation Roundtable, proposes a ‘Media Freedom and Standards Act’, which would include a provision, modelled on s3 of the Constitutional Reform Act 2005, which would place a duty on the relevant Secretary of State and other

15.2

pp3-4, para 17, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Tim-Suter-ofPerspective-Associates.pdf 340 p4, para 1.11, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Ofcom.pdf 341 pp5-6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-The-Campaign-for-Pressand-Broadcasting-Freedom.pdf 342 p11, para 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-CoordinatingCommittee-for-Media-Reform.pdf 343 p89, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-StandardsTrust.pdf

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Ministers of the Crown to uphold the freedom of the press and its independence from the executive.344 His suggestion is in these terms: “GUARANTEE OF MEDIA FREEDOM (1) The Secretary of State for Culture, Olympics, Media and Sport and other Ministers of the Crown and all with responsibility for matters relating to the media must uphold the freedom of the press and its independence from the executive. (2) The Secretary of State for Culture, Olympics, Media and Sport must have regard to: (a) the importance of the freedom and integrity of the media; (b) the right of the media and the public to receive and impart information without interference by public authorities; (c) the need to defend the independence of the media. (3) Interference with the activities of the media shall be lawful only insofar as it is for a legitimate purpose and is necessary in a democratic society, having full regard to the importance of media freedom in a democracy.” 15.4 Mr Tomlinson explained the intension behind, and anticipated effect of, this proposal:345 “It’s partly intended as a statement of, as it were, quasi-constitutional principle. Like the independence of the judiciary is a fundamental constitutional principle, so the independence of the media should be as well. What that means in practice is that if the Secretary of State of is making decisions which will impact on the way the media operates, the Secretary of State must be guided by this principle. And there are circumstances in which one could envisage situations where that would force the Secretary of State to go in one direction rather than another.” 15.5 Lord Prescott does not advocate an explicit role defending freedom of expression but he argues that any new framework should expressly require any regulator to have regard to case law under the ECHR and the HRA.346 Ms Harman states that the Labour Party believes that any Bill establishing a new system should also include constitutional safeguards for the freedom of the press.347 She goes on to suggest that this might be done via the introduction of a statutory public interest defence. Ms Harman is not alone in arguing for a public interest defence, which is raised by the MST, Hacked Off, MediaWise, the Coordinating Committee for Media Reform, Max Mosley, Roy Greenslade and the Media Regulation Roundtable. I have dealt earlier348 with the problems associated with the creation of statutory public interest defences in criminal law and I will not revisit that here.

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p6, para 13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Media-RegulationRound-Table.pdf 345 p11, lines 14-25, Hugh Tomlinson QC, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Afternoon-Hearing-13-July-20121.pdf 346 p6, para 6, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-working-group-led-byLord-Prescott.pdf 347 p5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/06/Submission-by-Harriet-Harman-QC-MP-onbehalf-of-the-Labour-Party1.pdf 348 Part J, Chapter 2, section 6

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16. Protection of journalists
Whistleblowing and a conscience clause
16.1 Lord Hunt suggested that a new regulatory structure should have a whistleblowing hotline349 and the CCMR recommends that the new regulatory body should establish a whistleblower code.350 The NUJ makes a strong case that there should be some protection for journalists who are put under pressure to behave unethically. To this end, it recommends that all journalists’ contracts should include a ‘Conscience Clause’ to prevent a journalist from being dismissed for a refusal to breach ethical standards:351 “A journalist has the right to refuse assignments or be identified as the creator of editorial which would break the letter of [sic] the spirit of the Code. No journalist should be disciplined or suffer detriment to their career for asserting his/her rights to act according to the Code.” 16.3 Specifically the NUJ recommends that a new standards code should include a provision requiring the inclusion of such a clause in journalists’ contracts. The CCMR argued that a news standards code should itself include a conscience clause supporting journalists who refuse to work in ways that breach the code of practice.352 Similarly Professor Greenslade argues for the inclusion of a conscience clause within the code and for the protection of journalists who act as whistleblowers or who invoke the conscience clause.353 When this was put to Rupert Murdoch as a suggestion he agreed that a conscience clause along those lines in employment contracts would be a good idea:354 “Q: Are you aware that the NUJ has for a long time been seeking the insertion in contracts of employment, not just at News International but other titles, of a conscience clause, that’s to say a provision by which it is forbidden to discipline a journalist who refuses to do something which is unethical or against the code of practice? A. I have never heard of it. LORD JUSTICE LEVESON: Do you think it’s a good idea? A. Yes. I think – I wouldn’t do it through the NUJ, but I think for – LORD JUSTICE LEVESON: No, but the clause. A. For us to say as a condition of employment in a contract for a journalist they have the right to do that, I think that’s a good idea.”
p80, lines 20-24, Lord Hunt, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-9-July-2012.pdf 350 p14, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-CoordinatingCommittee-for-Media-Reform.pdf 351 p13, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Michelle-Stanistreet-onbehalf-of-the-National-Union-of-Journalists.pdf 352 p14, para 4, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-CoordinatingCommittee-for-Media-Reform.pdf 353 p14, para 12, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-RoyGreenslade-of-City-University.pdf 354 p100, para 6-20, Rupert Murdoch, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/04/Transcript-ofMorning-Hearing-26-April-2012.pdf
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Moral rights
16.5 Professor Chris Frost raised the issue of the position of journalists in relation to moral rights. Essentially, the Berne Convention requires recognition of two inalienable rights of authors in literary and artistic works. The first is the right (even after transfer of copyright) to claim authorship of a work (‘the paternity right’) and the section is the right to object to any distortion, mutilation or other modification of a work which would be prejudicial to the author’s honour or reputation (the ‘integrity right’).355 Under the Copyright Designs and Patents Act 1998 (CDPA), these rights do not apply in relation to any work made for the purpose of reporting current events or in relation to a literary work made available for publication in a newspaper, magazine or similar periodical.356 Professor Frost argued that these moral rights should be extended to cover journalistic work:357 “So I can prevent material being published under my byline if I disagree with it. In this instance, if I think it’s unethical. Equally, I could argue about material that I had written being changed to make it unethical. That doesn’t stop a newspaper publishing it without a byline or with what’s known as a cod-byline, an invented byline of a fictional person, but it does mean that it wouldn’t be there under my byline and that’s quite important to a number of journalists who have become very upset – quite rightly so – when stories are changed or completely rewritten or a headline is put on the top of them which does not reflect what they wrote and what they know to be accurate and ethical.” 16.6 Given that this was a new issue that had not been raised before the Inquiry before, I invited press Core Participants to make submissions on the matter; two, the Telegraph Media Group (TMG) and News International (NI) did so. Both advanced similar arguments. The exemptions in the CDPA had been inserted into the Bill that subsequently became the CDPA. News International provided evidence that:358 “It was reported to the House of Lords in the course of the debates that the government had received many representations about the dire effect of moral rights on newspapers, particularly, it seems, from the editor of the Economist, who had given evidence to the committee. Lord Lloyd of Hampstead said that: “intolerable complications would be created if it were applied to newspapers, magazines and composite works”. Lord McGregor, a Labour spokesman and former Chairman of the Royal Commission on the Press, concluded that “The exercise of moral rights in such circumstances would have posed a threat to an editor’s right to edit and would have emasculated his responsibility for the form and content of his newspaper.” Lord Hemingford stated: “allowing a reporter the right to insist on being identified or not to suffer alteration to what he has written or possibly dictated over the telephone from notes would be unrealistic and impractical in a newspaper context.”” 16.7 TMG argued that to require either the paternity right or the integrity right would delay the news and be wholly impractical for the newspapers to operate.359 TMG felt that it was not clear whether Professor Frost was arguing for the repeal of the exemption provisions for

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TMG submission on moral rights para 5 ss79 and 81, Copyright Designs and Patents Act 1998 357 p13 lines 7-11 http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-Afternoon-Hearing10-July-2012.txt 358 p18, para 66, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-Submission-from-NewsInternational.pdf 359 Telegraph Media Group submission on moral rights, paras 10, 11 and 17
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both rights or only in respect of integrity and I share that uncertainty. It is clear to me that the context in which he raised the issue was that of integrity but that a combination of both rights, namely a right to assert authorship and a right to prevent ‘distortion, mutilation or other modification’ of a work, would indeed be problematic in a newspaper environment. It is less clear to me that allowing the integrity right on its own would cause the problems complained of by TMG and NI. If a journalist retained his integrity right but not his paternity right then, in any case where a publisher needed to make changes to a text and did not have time to seek the permission of the author, they could simply remove the attribution. I am not, however, clear that this would be a desirable outcome for journalists, who might find themselves systematically denied attribution as a precautionary measure where articles have been edited after submission. 16.8 NI also drew my attention to the 2009 consultation by the UK Intellectual Property Office, resulting in a policy statement that the Government does not propose to alter the UK’s moral rights regime. Whilst this consultation did indeed consider the position of moral rights in the UK, it did so only in the context of proposed changes in relation to orphan works and the possibility of introducing an exception in relation to parody.360 I do not, therefore, consider that this constitutes a recent consideration by the Government of the issues raised by Professor Frost. NI further submitted that the Inquiry should not consider recommending the repeal of a statutory provision founded on a thorough debate without receiving full evidence on the implications of such a repeal. 361 I recognise the real force of this point and I do not feel that I have heard enough evidence on the matter to reach a fixed conclusion. I do, however, think that this is an issue that is worth looking at further. I would, therefore, encourage the Government to find an early opportunity to consult on it, with a view to identifying whether removing the exemptions for reporting on current affairs and material provided for publication in a newspaper or journal in relation to either or both of paternity and integrity rights would improve protection of journalists and journalistic standards.

16.9

http://www.ipo.gov.uk/consult-2011-copyright.pdf p18, para 66, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Closing-Submission-from-NewsInternational.pdf
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1. the press Council of Ireland and the press ombudsman
History and background
1.1 The Irish Press Council and Ombudsman system was set up in 2007 as a direct response to the threat of legislation from the Irish Government. The Chair of the Press Council, Daithí O’Ceallaigh, described the agreement eventually reached between the Government and the industry as:1 “a win-win solution….[where] at least some of the changes in defamation law sought by the industry would be incorporated in a new Act and, in return, the industry would sponsor an independent Press Council and Press Ombudsman along lines broadly acceptable to government.” 1.2 In the mid 1990s the Irish Government set up a Commission on the newspaper industry; in 1996, that body recommended the establishment of a Press Ombudsman, but no action was taken.2 Then in 2002, the Minister for Justice, Michael McDowell, set up an expert advisory group which reported in 2003 with a recommendation for a statutory system of regulation for the press.3 The industry set up a steering committee to consider its response; this committee included representatives of all the major newspaper groups in Ireland, including some of those based in the UK, namely News International and Trinity Mirror.4 This group ultimately developed a model for the Press Council, which was to be independent of Government and, in its operations, independent of the industry; this was the model that was adopted for the new Council and Ombudsman in the summer of 2007. Professor John Horgan, the Irish Press Ombudsman, explained to the Inquiry his understanding that the Press Council had been established with the quid pro quo that that Government would withdraw its proposals for the statutory regulation of the press.5 At the same time, the Government agreed to use the legislative opportunity provided by the Defamation Bill in 2009 to offer some statutory underpinning for the new Council.6 Professor Horgan made it clear that the industry considered there to be a very real threat that the Government would legislate for press regulation in the absence of an adequate selfregulatory solution:7 “LORD JUSTICE LEVESON: But behind it all, do I gather from what you were saying somewhat earlier, was the threat of statutory regulation?
1 2

1.3

1.4

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p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/11/Press-Council-of-Ireland-Chairman-speech.pdf p51, lines 2-10, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Morning-Hearing-13-July-20121.pdf 3 p51, lines 11-15, Professor John Horgan, ibid 4 pp51-52, lines 24-4, Professor John Horgan, ibid 5 p52, lines 17-24, Professor John Horgan, ibid 6 p53, lines 9-22, Professor John Horgan, ibid 7 pp55-56, lines 23-18, Professor John Horgan, ibid

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A. Absolutely. LORD JUSTICE LEVESON: So in other words, it behoved the press interests to come up with a solution that was less than the club that was being held over them? A. That is absolutely the case. And in fact my membership, or our membership of the Alliance of Independent Press Councils of Europe indicates that in quite a few countries this threat has been the engine which has generated or promoted the successful establishment of press councils of the same kind in many European countries. So even though before this threat was made, there had been moves towards the establishment of something like this, the 1996 report of the commission, which wasn't under such a threat, recommended the establishment of an ombudsman. As I said, it was the real and present danger of that that created the situation in which we found ourselves.”

Legal recognition
1.5 In practice the Defamation Act 2009 set out some fairly detailed requirements for the structure, coverage and operation of a Press Council before it could be recognised under the legislation; this meant that, whilst the detail of both the code of practice and the complaints mechanism were left to the industry to set, the broad framework was dictated by the legislation if the industry wanted to take advantage of the protection offered by the Act. Professor Horgan told the Inquiry: “without the benefit of knowledge of what went on behind closed doors in the four years leading up to the creation of the Press Council, it might be thought that this legislation represents a framework imposed by the state on the private sector. Whereas in fact – and Professor Thomas Mitchell has briefed me extensively on this – by and large the provisions relating to the Press Council that found their place in the Defamation Act were those proposed by the Press Council itself to the government.” There is scope within the Act for the industry collectively to decide not to create a Press Council, and for any individual journal to decide not to participate. However, the Press Council of Ireland, as currently constituted, was established before the Act came into force and all significant publishers of newspapers in Ireland are members of the Council.8 Benefits 1.6 The Act provides a defence of ‘fair and reasonable publication’ to a defamation action.9 In the case of a statement published in a periodical by a person who at the time of publication was a member of the Press Council, a court in considering whether publication was fair and reasonable may take into account the extent to which the person adhered to the code of standards of the Press Council and abided by determinations of both the Press Ombudsman and the Press Council.10 There was, as yet, no case law on this.11 Professor Horgan clarified that this did not mean that the defence was only available to those who had signed up to the system. The defence was also available, in theory, to other publications if they could satisfy

pp66-67, lines 13-4, Professor John Horgan, ibid Defamation Act 2009 s26, http://www.irishstatutebook.ie/pdf/2009/en.act.2009.0031.pdf 10 ibid 11 p3, para 5, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-John-HorganIrish-Press-Ombudsman.pdf
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the court that they operated to standards and procedures in no way inferior to those of the Council. Similarly, this had not been tested in court and Professor Horgan said:12 “My honest view it that it would be quite difficult for publications that are not members of the Council to satisfy a court that they operate to such standards.” 1.7 In order to enact these benefits, the Act makes provision for the Minister, by order, to recognise a body as “the Press Council” for the purposes of the Act. The requirements for recognition are specific and detailed and it is worth setting them out here to show the extent to which the Defamation Act establishes the objectives and the structural independence of the Press Council, the approach to dealing with complaints and the overarching coverage of the code of standards. Only one Press Council may be recognised at any one time. Before the Press Council can be recognised the Minister must satisfy himself that it meets the specifications set out in Schedule 2 to the Act. He can revoke the recognition at any time he considers that the Press Council fails to meet the specifications in the Schedule.13 So far this power has been used once, in April 2010, to recognise the Press Council of Ireland as ‘the Press Council’. Schedule 2 of the Act requires that the Press Council should have the principle objectives of:14 “(a) ensuring the protection of freedom of expression of the press, (b) protecting the public interest by ensuring ethical, accurate and truthful reporting by the press, (c) maintaining certain minimum ethical and professional standards among the press, (d) ensuring that the privacy and dignity of the individual is protected.” Interestingly, Professor Horgan told the Inquiry that the primary purpose of the Press Council was:15 “to maintain the rights of the press to freedom of expression, to maintain the independence of the press from the State and State control or regulation and to decide on appeals against decisions or the Press Ombudsman on complaints.” with the primary role of the Press Ombudsman being:16 “to receive and adjudicate on complaints, to raise public awareness of the work of his Office and of the Council, and to encourage and promote the highest ethical standards of journalism in Ireland.” Meanwhile, the website of the Press Council says that the objectives of the Press Council are:17

1.8

1.9


12

“To provide the public with an independent forum for resolving complaints about the press.

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p54, lines 1-10, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Morning-Hearing-13-July-20121.pdf 13 Defamation Act 2009 s44, http://www.irishstatutebook.ie/pdf/2009/en.act.2009.0031.pdf 14 Defamation Act Schedule 2.2, http://www.irishstatutebook.ie/pdf/2009/en.act.2009.0031.pdf 15 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-John-Horgan-IrishPress-Ombudsman.pdf 16 pp1-2, ibid 17 http://www.presscouncil.ie/about-the-press-council.77.html

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• •
1.10

To resolve all complaints quickly, fairly and free of charge. To defend the freedom of the press and the freedom of the public to be informed.”

Specific provision is made in the Act about the structure of the Council, the number of members and how many of those members should independently represent the public interest, the interests of owners and publishers, and of journalists.18 The Schedule makes requirements about the independence of the appointments procedures; it requires that the Minister should be satisfied by the independence of the appointments procedure but gives him no role in establishing or operating it.19 Professor Horgan told the Inquiry that it was clear to the industry when they were formulating their proposals for the Council that:20 “one critical aspect of what the industry proposed to establish, without which no possible measure of Government acceptance or approval would have been available, was independence.”

1.11

1.12 1.13

It is a requirement of the Act that the Press Council should be funded by subscribing journals and should receive no funding from other sources.21 The Act requires that the Press Council should appoint a body (the Press Ombudsman) to resolve complaints about the conduct of its members. The Press Ombudsman is to have the power to require publication of its own decisions, corrections, retractions and “such other action as the Ombudsman may, in the circumstances, deem appropriate”. Decisions of the Ombudsman are to be appealable to the Press Council itself, which is to have similar powers in respect of requiring publication of decisions.22 The Press Council must have adopted a code of practice with which all members are required to comply; this includes:23 “(a) ethical standards and practices, (b) rules and standards intended to ensure the accuracy of reporting where a person’s reputation is likely to be affected, and (c) rules and standards intended to ensure that intimidation and harassment of persons does not occur and that the privacy, integrity and dignity of the person is respected.”

1.14

The Press Council
1.15 The Council was created by the Press Industry Steering Committee, comprising the publishing trade associations and the NUJ, in accordance with the provisions set out in the Act.

Defamation Act Schedule 2.5, http://www.irishstatutebook.ie/pdf/2009/en.act.2009.0031.pdf Defamation Act Schedule 2.6, ibid 20 pp56-57, lines 24-4, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-13-July-20121.pdf 21 Defamation Act Schedule 2.7, http://www.irishstatutebook.ie/pdf/2009/en.act.2009.0031.pdf 22 Defamation Act Schedule 2.8-2.9, ibid 23 Defamation Act Schedule 2.10, ibid
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Appointments 1.16 The Act requires the Press Council to comprise 13 members, of whom seven are independent members representing the public interest, five represent the interest of owners and publishers and one represents the interest of journalists.24 The public interest members are appointed by an independent four-person Appointments Committee, on the basis of public advertisement and interview.25 The Chair of the Council is appointed from within the public interest members, although in practice external applications have also been invited.26 The industry and journalist members are nominated by the various organisations that took part in the steering committee and the Appointments Committee ratifies the nominations. Professor Horgan explained that there was not an automatic guarantee of appointment for those who were nominated, but he could not readily foresee a situation in which such nominations would not be ratified.27 The first Appointments Committee was appointed by the Press Industry Steering Committee. Subsequent appointments to the Committee are made by the Press Council. The appointments are for three years; that first Committee was subsequently re-appointed for a second three year term by the Council in July 2010.28 As of August 2010, the Chair of the Council was also the Chair of the Appointments Committee.29 The five industry members of the Press Council are current senior editorial executives, although not usually editors. The only serving editor currently on the Council is the editor of a regional publication; he fills the slot effectively reserved for regional newspaper editors.30 Professor Horgan suggested that the absence of serving editors has worked well for the Press Council, particularly because he thought that there was more change of personnel than might be expected if editors were to hold the seats. The appointments are for a three year term, and can be extended for a second term; however, some four and a half years into the Council’s existence, only one of the original industry representatives is still a member of the Council.31 Professor Horgan told the Inquiry that the public interest majority on the Council was essential to the public acceptance of the independence of the model.32 He also regarded the presence of a journalist member on the Council alongside the industry members as essential.33 Structures and Funding 1.20 In line with the requirements of the Defamation Act, the Press Council is wholly funded by the press industry. The finances of both the Press Council and the Press Ombudsman are provided by the Administrative Committee of the Press Council; the Committee is chaired by an independent member of the Council but otherwise consists of representatives of the different types of publications covered, together with the NUJ. Each title covered by the Council pays a levy based on circulation.34

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1.18

1.19

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Defamation Act Schedule 2 s5(1), ibid p57, lines 19-22, Professor Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofMorning-Hearing-13-July-20121.pdf 26 p76, lines 13-22, Professor John Horgan, ibid 27 p58, lines 7-19, Professor John Horgan, ibid 28 http://www.presscouncil.ie/about-the-press-council/sub-sub-1.19.html 29 ibid 30 pp58-59, lines 24-7, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-13-July-20121.pdf 31 p59, lines 8-24, Professor John Horgan, ibid 32 pp74-75, lines 22-2, Professor John Horgan, ibid 33 pp75-76, lines 25-7, Professor John Horgan, ibid 34 http://www.presscouncil.ie/about-the-press-council/structures-and-funding-.2172.html
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1.21

Making a complaint is free to the complainant.35 The Code

1.22

The code was originally drawn up in 2007 by the Steering Committee. There is now a Code Committee, which is chaired by an independent retired journalist and comprises nominees of the industry bodies. Serving editors have the right to be on the Committee but, for the most part, they are represented by deputies or senior executives. The Ombudsman sits on the committee in an ex-officio capacity.36 Any changes to the Code are made in consultation with the Council. The Council can also suggest changes to the Code Committee. There have not, in fact, been any significant changes since the code was originally drafted.37 It may be worth noting that the code would have been available to the Government to see when formulating the terms of the 2009 Defamation Act. Coverage

1.23

All national newspapers, including all the UK papers that are published in Ireland, and over 90% of regional newspapers, are members of the Press Council. Around 60%, by number, of periodicals are members of the Council, but this would account for considerably more than 60% of circulation as the larger magazines are members.38 Since the creation of the Council no members have left, or threatened to leave, the system.39 Recently a news website has applied for membership and the Council is considering the appropriate criteria for membership of web media.40 Public awareness and satisfaction

1.24

Professor Horgan told the Inquiry that public awareness of the Press Council and Ombudsman was limited. A public awareness campaign had been launched in an attempt to make the services provided by the Ombudsman more widely known.41 Impact of statute on freedom of speech and the public interest

1.25

Professor Horgan did not think that the statutory recognition afforded to the Press Council by the Defamation Act constituted a limitation on the freedom of expression because the limitations in the Act were, by and large, those proposed and endorsed by the industry itself as a necessary balancing of the right to publish against the rights of individuals.42 The belief of the Council in the importance of the freedom of the press is reasserted in the preamble to the Code.43 In this context it is worth noting that all UK titles that publish in Ireland are members of the Council; they do not appear to allow any principled objections to statutory underpinning of press self-regulation to get in the way of constructive and willing participation in this system.

1.26

p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-John-Horgan-IrishPress-Ombudsman.pdf 36 p92, lines 1-17, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Morning-Hearing-13-July-20121.pdf 37 pp60-61, lines 20-4, ibid 38 p66, lines 14-25, ibid 39 p68, lines 3-5, ibid 40 p67, lines 6-10, ibid 41 pp67-68, lines 16-2, ibid 42 p73, lines 14-25, ibid 43 p74, lines 3-8, ibid

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1.27

The public interest is not defined in the code, and it is left up to the Council and the Ombudsman to interpret it on a case by case basis. The code does set out a general principle:44 “that the public interest is invoked in relation to a matter capable of affecting the people at large so that they may legitimately be interested in receiving and the press legitimately interested in providing information about it.”

The Press Ombudsman
1.28 The Press Ombudsman primarily receives and adjudicates on complaints. The Ombudsman is appointed by the Press Council and reports to the Council on a monthly basis in respect of administrative matters.45 The Ombudsman is independent of the Council in the execution of his functions of investigation and adjudication, but his decisions can be appealed to the Council by either the complainant or the newspaper if they are dissatisfied.46 Professor Horgan stressed that his contract guarantees his independence from the Council and that the Council had recently agreed to amend its articles of association to give him greater independence. In particular the Ombudsman now has discretion to make decisions on whether someone is a person directly affected, and to rule out vexatious and frivolous complaints.47 Complaints 1.29 Complaints can only be made in respect of publications that are members of the Press Council of Ireland. A complaint can relate to any article that breaches the Code of Practice or to the behaviour of a journalist that breaches the Code.48 Complainants are expected to go in the first instance to the publisher concerned, and the Ombudsman will only consider complaints if the complainant has not received a satisfactory reply within two weeks.49 Professor Horgan told the Inquiry that he had: “got a very severe telling off, which I think in the circumstances was quite justified, from the editor of the newspaper concerned…..” when he had, on one occasion taken a compliant directly at the request of the complainant who had been too fearful to confront the newspaper itself.50 1.31 Complainants are free to take their cases to court in advance of, alongside or after a case is considered by the Ombudsman. The Ombudsman will not consider a case while it is before a court, but will suspend consideration of the complaint until legal proceedings have concluded.51 Professor Horgan could only recall one example of a complainant having taken legal action in respect of a matter which had already been adjudicated by him.52

1.30

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pp93-94, lines 22-4, ibid p79, lines 15-21, ibid. p80, lines 3-13, ibid 46 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Professor-John-HorganIrish-Press-Ombudsman.pdf; p80, lines 13-16, Professor Horgan, http://www.levesoninquiry.org.uk/wp-content/ uploads/2012/07/Transcript-of-Morning-Hearing-13-July-20121.pdf 47 pp78-79, lines 24-12, ibid 48 http://www.presscouncil.ie/office-of-the-press-ombudsman.167.html 49 p63, lines 4-10, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Morning-Hearing-13-July-20121.pdf 50 pp61-92, lines 22-9, ibid 51 p64, lines 1-12, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Morning-Hearing-13-July-20121.pdf 52 pp64, lines 7-20, ibid
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Process 1.32 The Ombudsman will generally carry out conciliation and reach conclusions on the basis of documentation alone, although there is also provision for face-to-face mediation, which may be used more often in future.53 All decisions, whether by the Press Ombudsman or, on appeal, by the Press Council, are published to the interested parties and on the Press Council/ Ombudsman website.54 An annual report is published setting out the data and the approach taken to key issues. Volume and results 1.33 In the four years of its operation the Irish Press Ombudsman has received on average between 340-350 complaints per year. This is roughly analogous, in proportion to population, to the number received by the PCC. There is, however, one striking difference between the outcomes from the Irish Ombudsman and those from the PCC. The Irish Press Ombudsman has reached a decision on nearly 12% of the complaints brought to it over its four year lifetime, which compares to substantially less then 1% of complaints to reach adjudication with the PCC.55 In 2010 and 2011 around two thirds of the decisions of the Press Ombudsman have included a finding that the code was breached, with sufficient remedial action already having been taken by the publisher in up to half of those cases.56 Comparatively few cases are conciliated, with only 19 (6% and 5.5% respectively) conciliated in each of 2010 and 2011.57 Appeals 1.34 Either party to a complaint can appeal the decision of the Press Ombudsman to the Press Council. Professor Horgan told the Inquiry that there were a substantial number of appeals in the early years but that only very few appeals were upheld by the Press Council.58 The figures provided to the Inquiry show that 53% of the decisions taken by the Press Ombudsman have been appealed to the Council over the four years. There was a substantial dip in the level of appeals in 2009, but otherwise the proportion of decisions appealed has been over 50% in every year of the Press Ombudsman’s operation. It is not obvious from the figures whether those appeals were by publishers or claimants and Professor Horgan told the Inquiry:59 “Initially quite a substantial number of my decisions would have been appealed, either by newspapers or by complainants, on the grounds that, well, it was free and, you know, why not have a second bite at the cherry?” Very few of these appeals are upheld, however, with only three appeals having been upheld in four years (although some 12 appeals are described as being still outstanding).60

pp84-85, lines 22-10, ibid http://www.pressombudsman.ie/making-a-complaint.24.html 55 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Exhibit-to-Submission-by-Professor-JohnHorgan-Irish-Press-Ombudsman.pdf 56 ibid 57 ibid 58 p81, lines 2-9, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Morning-Hearing-13-July-20121.pdf 59 pp80-81, lines 23-1, ibid 60 p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Exhibit-to-Submission-by-Professor-JohnHorgan-Irish-Press-Ombudsman.pdf
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Standards 1.35 The Ombudsman deals with individual cases and has no remit to identify or respond to any systemic issues which might become apparent from cases that he considers. Professor Horgan told us this would be a matter for the Press Council, on the basis of its own assessment of the issues before the Ombudsman and the decisions being reached. However, the Press Council does not have the power to conduct own-initiative investigations, and has no specific remit to tackle serious or systemic problems. Some efforts have been made to address systemic issues by, for example, sponsoring seminars on relevant matters.61 Sanctions 1.36 The only sanction available to the Press Ombudsman is the requirement for the newspaper or magazine to publish a decision upholding a complaint.62 Professor Horgan told the Inquiry that all the major newspapers have been the subject of critical adverse findings in one form or another.63 Decisions of the Press Ombudsman also frequently include a correction of inaccurate facts.64 Detailed guidelines have been adopted by the Council in relation to the publication of a decision by the Press Ombudsman. In relation to prominence of publication these guidelines say:65 “(3) Those sections of decisions of the Press Ombudsman upholding a complaint should be published: (a) in full; (b) promptly; (c) on the same page as the original article, or further forward, subject to the exception at (6) below; (d) on the same day of the week as the original publication, (e) with similar prominence; (f) unedited; and (g) without editorial commentary by way of a headline or otherwise. In addition, each should carry, above the headline, a strap-line indicating that it is a decision of the Press Ombudsman. [….] (6) Where a complaint has been upheld in relation to an article published on the front page of a publication, the decision should be published with due prominence on one of the first four editorial pages.” UK titles as members 1.37 Professor Horgan told the Inquiry that UK titles accounted for 30% of membership of the Council, but were responsible for around 22% of the complaints. These figures have to be viewed with caution, however, as they make no allowance for circulation figures or other differences between titles.66 In respect of the types of complaint that were received about UK titles and Irish titles, Professor Horgan said:67 “There’s absolutely no discernable differentiation between the basis of the complaints against indigenous publications and those against UK-based publications.”
p65, lines 2-24, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcriptof-Morning-Hearing-13-July-20121.pdf 62 p90, lines 4-6, ibid 63 p68, lines 9-11, ibid 64 pp90-91, lines 25-2, ibid 65 Office of the Press Ombudsman, Publication Guidelines, http://www.pressombudsman.ie/cases-appeals/ publication-guidelines-for-newspapers-and-periodicals.1161.html 66 p71, lines 10-19, Professor John Horgan, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Morning-Hearing-13-July-20121.pdf 67 p72, lines 3-6, ibid
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Professor Horgan went on to say that he had no complaints at all about the cooperation of any of the publications with the Ombudsman.68

2. Other models of press regulation: Europe and beyond
2.1 In this section I consider systems of press regulation operated in Europe and elsewhere; whether they are comparable to conditions in the UK and whether there are lessons that might be learnt and applied. It is important to start by noting that, while there may be similarities between systems of press regulation, no two systems are the same and there are important differences. While all of those countries in consideration here operate systems of self-regulation, they differ from the PCC in many ways. In some cases, notably Denmark, Sweden, Finland and Germany, there is some form of involvement by government, either through statute or because of financial support; in the case of France, the impact of legislation is very different to the model in the UK and has real impacts upon the functioning of the press in that country. Most of the comparative European countries operate a form of self-regulation through a Press Council, but also in some cases a Press Ombudsman (notably in Sweden). Unsurprisingly, the majority of the Press Councils operating in Europe and internationally, have been established solely with the printed press in mind. The development of new media, such as online publications and micro-blogging sites, have created opportunities for Press Councils to review existing frameworks, in order to consider options for incorporating new media platforms into their regulatory structure. This has included consideration of how to encourage membership, as well as how to meet the expectations for new media platforms and additional sources of funding for the system of regulation.69 By way of example, Denmark operates a ‘polluter pays’ policy for online members who have joined the Press Council. However, this is regarded as a temporary measure, as no official funding mechanism has yet been developed.70 Online and the self-regulatory settlement with online publishers is considered as and where appropriate in this section. This section will also look at the composition of the Press Council Boards, as well as sources of funding for the industry; both are important variables. The German Press Council for example is co-funded by the German Government. This system has not led to statutory regulation; neither has it been suggested that the Government exerts a deleterious influence simply because of the public funding. In her extremely well informed evidence to the Inquiry, Lara Fielden, a Visiting Fellow at the Reuters Institute for the Study of Journalism, has suggested that, although many of the European Press Councils profess to focus on the embedding and maintenance of journalistic standards, in practice this role is limited and most Press Councils are reactive and complaints driven instead.71 I will first consider the Scandinavian countries and thereafter Germany, France and the Netherlands. I will then pass on briefly to review the situation in both the United States and China.

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p73, lines 7-12, ibid p79, lines 10-1, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf 70 p80, lines 6-10, Lara Fielden, ibid 71 pp72-73, lines 24-3, Lara Fielden, ibid
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Denmark, Sweden and Finland
2.6 The press in the Scandinavian countries has been described as a collective press which has historically prided itself on the publication of information to high standards of accuracy, and within the boundaries set by a clear journalistic code. In each of the Scandinavian countries, the respective Press Council has powers to raise monetary contributions and, if an article is found to breach the code, to mandate the publication of the fact of a breach along with an apology. Furthermore, in Denmark, the Press Council additionally has the ability (rarely used) to fine or imprison an editor-in-chief who fails to comply with a publication of a Council adjudication.72 As to the relevance of rights of individuals, the Swedish Code of Standards includes the clause that journalists should:73 “Refrain from publicity which could violate the privacy of individuals, unless the public interest obviously demands public scrutiny”. Ms Fielden explained that the tabloid press in the Scandinavian countries had become increasingly comfortable with reporting on the private lives of politicians and others.74 2.7 Significantly, there are no press laws in place, nor specific legislation relating to the regulation of the printed press, in Denmark, Sweden or Finland. However, contrary to assertions made in evidence and in public over the course of this Inquiry, there are elements of governmental involvement that can be found in the systems of press self-regulation operated in these Scandinavian countries. For example, and most notably, the Danish Press Council is established in statute, pursuant to the Danish Media Liability Act 1998, albeit that other elements of the system are self-regulatory particularly in terms of handling adjudications, the composition of the Press Council Board and the exercise of Council responsibilities. Under the terms of the Act, all publications which are in printed circulation more than twice a year, as well as holders of broadcast licences, are subject to regulation by the Danish Press Council. The Council also deals with complaints across all media platforms, including online media, provided (in the case of online publishers) that these organisations are registered with the Council. Ms Fielden has explained that registration in Scandinavia is the expectation and is not perceived as a form of licensing.75 Indeed, it is compulsory for any publisher seeking to participate in the self-regulatory system in Denmark, Sweden and Finland. The procedure of registering an editor-in-chief responsible for the publication is representative of the Scandinavian approach to responsible and accurate journalism.

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Lara Fielden notes that a prison sentence has never been passed, although in the 1990s, a number of fines were imposed 73 p80, lines 1-3, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf 74 pp67-68, lines 24-3, Lara Fielden, ibid. This may be borne out by the reaction to the publication in France of the pictures of the Duchess of Cambridge (see Part F Chapter 7(7) and, in relation to the French publication, footnote 99 below. The Swedish magazine, Se och Hör (See and Hear), and the titles’ sister Danish edition (similarly titled Se og Hør) both published the photographs within 24 hours of the injunction being granted. The editor-in-chief of Se och Hör defended the publication, saying that there had been nothing unusual about the publication of topless celebrities in their title. On Newsnight (19 September 2012), she did not deny they may have breached the privacy of the Duke and Duchess but said that the photographs presented a “lovely couple in love”, which conformed with the focus of the magazine on celebrity relationships. As they had been obtained before the injunction, there was nothing withholding the title from publishing. The editor of Se och Hör in Denmark commented that the purpose of Se og Hør is to provide material to entertain 75 p78, lines 2-9, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf

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Denmark 2.9 Any journalist, or individual who imparts news in some way, whether through printed media or online, is protected under the Danish Press Council’s professional umbrella. The benefits of membership of the Council include access to privileges in law such as the protection of journalists’ sources. This has been the incentive for many online publishers to join the Council on a voluntary basis.76 They have the ability to differentiate themselves from other online media who are not regulated by the Council. Online publishers are expected to contribute to the industry funding of the Press Council if they are affiliates of existing members (such as the online presence of a broadcaster or a printed newspaper). However, purely online-only outlets are not expected to contribute. This is partly due to the non-existence of a funding mechanism and is compensated by the Danish Press Council operating the ‘polluter pays’ policy, which is applied if an online member breaches the Code.77 It is noteworthy that, in similar fashion to the PCC, the Danish Press Council does not accept third party complaints and deals with only those individuals who have been directly affected by press misreporting. One of the primary roles of the Danish Press Council is the duty to enforce a right of reply (albeit limited to specific factual inaccuracy). This power is enacted in statute under the Danish Media Liability Act 1998, and is procedurally different to the remedy obtainable from the court,78 and applies to both newspapers and broadcasters.79 Save for this and for the penal consequences visited on the editor-in-chief for failure to publish adjudications by the Press Council, there are no other enforceable rights under the Act. Like the Press Councils in Sweden and Finland, the Danish Press Council does not have the power to award compensation or to impose financial penalties. Although the Danish Press Council is set up in statute, it is still at a fundamental level selfregulatory and is regarded as such by its members. The eight members of the Council are appointed for their industry expertise. Historically, a member of the Danish Supreme Court has always been appointed as the Chair of the Council and a lawyer has held the position of ViceChair. The remainder of the Council consists of industry members, who are either journalists or editorial management, or independent public members; each is equally represented with two positions on the panel. Although the system operated in Denmark has its benefits, it has come under parliamentary scrutiny, in particular for the placement of apologies and corrections.80 According to Ms Fielden, publications are:81 “…still, even within this co-regulatory framework, burying publication of an adjudication on sort of page 54”. In her evidence she highlighted the different approach of publications towards ‘regulation’ and noted the distinction between two media camps: those who are found in breach and are
p81, lines 8-25, Lara Fielden, ibid p82, lines 2-11, Lara Fielden, ibid 78 pp76-77, lines 21-17, Lara Fielden, ibid 79 Previous attempts at passing a similar right of reply bill through UK Parliament been unsuccessful to date. See Peter Bradley Submission – http://www.levesoninquiry.org.uk/wp-content/uploads/2012/03/Submission-by-Peter-Bradley. pdf 80 The review by the Danish Parliamentary Select Committee, at the time of writing, was due to report in the Autumn of 2012 81 p89, lines 11-13, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf
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ordered to comply with adjudications by the Danish Press Council; and those who voluntarily choose to comply with regulation in order to benefit from the protections that membership of the Press Council offers. Sweden 2.14 In Sweden, the press and press freedom are specifically protected by two of Sweden’s four constitutional laws. These function to protect the freedom of speech (Freedom of the Press Act 1991) and the freedom of the Swedish press (Freedom of the Press Act 1949). These freedoms apply to any individual who has registered for authorisation to publish and can include private individuals such as online bloggers. Both Acts guarantee a ban on censorship, the protection for anonymous sources and the right of public access to documents held by Swedish authorities.82 Press standards in Sweden are upheld through the Swedish Press Council. Membership is voluntary and not backed by legislation, unlike in Denmark. Newspapers and print publications are authorised to publish as members of either the Swedish Newspaper Publishers’ Association, the Magazine Publishers’ Association, the Swedish Union of Journalists, or the National Press Club. There are no restrictions on who can apply for a licence through the Swedish Press Council. These organisations collectively finance the system of self-regulation, and also set the Code of Ethics for the printed media (and broadcasting) in Sweden. In Sweden, the editor-in-chief of a print publication is legally responsible for all content published by that title and is answerable to the Press Council Board. There are a total of 18 members of the Press Council Board. In similar fashion to Denmark, the Chair and three Vice-Chairs are members of the Swedish Supreme Court. The remaining members are representatives from the four associations responsible for funding the Press Council, as well as three representatives of the general public who are without affiliation to the press. This composition of the Board is seen as a way of underpinning the independence of the system of self-regulation in a country that has historically esteemed the freedom of the press and sought to protect it in law.83 Sweden also operates a Press Ombudsman whose role is to investigate complaints, provide information and advice to the public and contribute to the development of press standards. Both the Press Council and the Ombudsman deal with the online versions of printed newspapers and magazines. The Press Ombudsman is the first point of contact for any complainant who has a personal interest in press misreporting or who has been directly affected by it. As such, third party complaints are not accepted by the Swedish Ombudsman. The Press Ombudsman does not act as a mediator but rather makes decisions on whether a complaint can be accepted and passed to the Council for adjudication. If the Press Ombudsman decides a complaint does not warrant formal criticism of the title in question, the complainant can appeal directly to the Press Council. There are also no restrictions to prevent a complainant from taking the grievance to court after it has been considered by the Press Ombudsman and the Press Council. The Press Ombudsman is appointed by a special committee which consists of the Chief Parliamentary Ombudsman, the Chair of the Swedish Bar Association and the Chair of the National Press Club. The length of time taken for an adjudication by the Press Council can be a further six or seven months after the Ombudsman has considered a submitted complaint

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Advisory note provided by the British Embassy in Sweden pp69-70, lines 15-5, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf
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(which can last itself three to four months). The remedy for such complaints is the right to reply or the publication of a correction. 2.19 In contrast to the UK and Denmark, however, the Swedish Press Council operates a system whereby titles are expected to contribute towards costs after a breach of the code. Whereas only online operators in Denmark are ordered to pay a levy towards the funding of the Council if they are in breach of the code, in Sweden, anyone who breaches the code is required to pay a ‘penalty’ towards the fund. It is estimated that this form of ‘polluter pays’ policy contributes approximately 20% of the Press Council’s funding.84 Finland 2.20 Finland’s printed press is regulated by The Council for Mass Media (CMM), established by publishers and journalists in 1968. It is the main body responsible for the self-regulation of Finland’s printed press and broadcasters. It is also the only self-regulatory system in the Scandinavian countries that encompasses all media platforms, including online journalism. Under Finnish Law, the freedom of speech is protected through the Exercise of Freedom of Expression in Mass Media Act 2003.85 Through this Act, publications are obliged to provide a public right of reply as well as the duty to correct factual inaccuracies. In similar requirements to Sweden, each publication must nominate an editor who holds the responsibility for all the published content of that publication. The CMM is responsible for issuing Guidelines for Journalists, which establishes professional conduct guidelines across cross-media platforms. Membership to the CMM is voluntary, although it is perhaps noteworthy that journalists who have affiliated membership to the Council commit themselves to advancing and upholding the principles set out in the Guidelines for Journalists. Dr Riitta Ollila, a member of the CMM has argued that the Council:86 “…does not act as a mediator between editors and audience but as a master of the code making remarks on the press of their errors.” Although the CMM has no legal jurisdiction over the regulation of the press, its position overseeing journalistic standards is generally accepted. The CMM receives state funding from the Finnish Government equivalent to 30% of the Council’s budget. 2.22 In contrast to Denmark, Sweden and indeed effective practice in the UK, the CMM is open to third party complainants. Complaints can be received from any member of public who considers that there has been a breach of good practice or violation of the Guidelines for Journalists. Any title or broadcaster found in breach of good practice is compelled by the CMM to publish a notice issued by the Council within a certain timeframe. Similarly to the PCC, the CMM will not rule on an issue or consider a complaint where legal action is being taken concurrently. The Council can only rule on complaints brought to the Council’s attention within three months of publication. The CMM is comprised of eight representatives of the industry and (including the Chair) four public members. Up until 2007, only a current or serving media professional could be appointed to Chair of the CMM. Changes have since been made which now allow a former

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pp75-76, lines 13-3, Lara Fielden, ibid The 2003 Act includes particular measures which are not applied to the printed press but are in relation to the distribution of network messages either on the internet or broadcasted through radio waves or other electronic measures 86 p6, para 8, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-from-the-Finnish-PressCouncil.pdf
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editor to assume the post of Chair of the CMM. These adjustments might have been to improve the operation of the Council, given the rate at which respective Chairs of the CMM have resigned.87 2.24 The membership of Press Councils in Scandinavia has historically been high; it appears that this is largely due to the reputational benefits of membership and the accountability that is perceived to be afforded by membership of the relevant Council. This is also shown through the increasingly high rate of membership by online media outlets, and the online platforms of traditional media. In addition, it appears to be the case that, in the Scandinavian countries, there is a culture of commitment to (and indeed pride in) high journalistic standards. Therefore the question of membership, irrespective of the cost of that membership to an individual publication, is not an issue for consideration by media bodies in Scandinavia. As has been noted, the only exception is Denmark, where any publication that meets the criteria defined by the Media Liability Act, is subjected to compulsory regulation by the Danish Press Council.

Germany
2.25 It has been argued by some commentators that the German Press Council operates the purest form of press self-regulation in Europe. In Germany, the press are regulated only by the press and are only subject to restrictions within the German Basic Law (Grundgesetz). The Press Council was established in 1956 and consists of members from industry organisations and the press trade unions. The Council has 28 industry members and the Chairmanship of the Council rotates between the representatives of the different industry organisations. Press behaviour and standards are set out in the German Press Code, first developed by the Press Council in 1973, which provides guidelines under which journalists should operate. In 2009, the Press Council expanded their remit to include online newspapers. The Press Council relies on Government funding for its operations (although there is a stipulation that the funding should not exceed 49% of the Press Council’s total revenue).88 Other than providing monetary support to the Council, the Government has no powers or influence over the day-to-day operations of the Council. Any member of the general public may make a complaint directly to the Council. Complainants do not have to waive their rights to initiate legal proceedings if they submit a complaint to the Press Council. If the Press Council Board supports a public complaint, then the newspaper in question is expected to publish the Press Council’s ruling. This public reprimand is a voluntary undertaking by the title in breach, rather than an order dictated by law or mandated as a condition of membership of the Council. Ms Fielden has noted that some 90% of German publishers have signed up to the voluntary undertaking, although one major publisher, the Bauer Media Group,89 has not renewed its declaration.90 Whilst the Press Council can request that these reprimands are published, as with the PCC, it cannot determine the prominence given to the publication of the decision. The authority of the German Press Council has not gone unchallenged, particularly in response to the publication of public reprimands. The newspaper Bild, the best-selling German tabloid, has questioned decisions made by the Press Council. By way of example, a published Press Council ruling on 29 November 2007 was printed by the paper in question not as an

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There have been three resignations by previous chairs in the last four years p24, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Exhibit-1-to-Submission-from-theNetherlands-Press-Council.pdf 89 Bauer Media Group own both publishing and media brands worldwide that include UK’s Bella, Take a Break, that’s life! and Q and Kerrang! magazines 90 p42, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Reuters-Institute-for-the-Study-of-Journalismsubmission-April-2012.pdf
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adjudication but, rather, as a criticism of that adjudication.91 The problem of compliance is ongoing and has led to delays in the publication of apologies. This has led to the reputation of the German Press Council being discredited and has damaged the public perception of its general credibility as a self-regulating body. 2.28 The approach of the German press is perhaps more aggressive than that in Scandinavia, although it may appear tame in comparison to standards in the UK. Its behaviour has been described best as a “balancing act”.92 Significantly, there is a culture in the German press (notably absent from the UK press) of titles publicly holding each other to account. In this respect, Bildblog is an example of an online media watchdog, which was originally established to examine the coverage by the Bild newspaper.93 Bild has also been criticised by its readers, notably for its coverage in 2010 of a number of deaths at a music festival in Duisburg.94 The title was accused of exaggerating reports of the deaths and came under intense scrutiny from the public and industry members alike. The German Press Council received a large number of complaints from readers, via traditional methods such as letters to the editor, as well as micro-blogging through channels such as Twitter. It has been argued that this event, and the resultant response, has led journalists to reflect on their standards of reporting for the future.

France
2.29 The system of press regulation in France is different to the countries so far outlined. In place of a Press Council, the press in France are regulated by the existing body of French law. Trade unions and professional associations, such as the Syndicat National des Journalistes and the Association des Journalistes Républicains Francais, are responsible for maintaining standards of journalism across the printed press. As a consequence, the development of a code of standards applicable to the industry has been problematic. Instead, both the Unions and professional associations have encouraged the appointment of ombudsmen at some newspaper titles. The first appeared in 1994 at Le Monde, although this has not been popular across the majority of the printed press. The Direction du Départment des Médias et des Industries Culturelles,95 is responsible for the development of Government policy in relation to the media and plurality. It is also responsible for providing financial support to parts of the media, most of which is directed towards the printed press. Efforts at creating a Press Council in France have been unsuccessful. The most recent attempt in 2006 led to the establishment of the Association de prefiguration d’un Conseil de press,96 led by a group of French journalists, although it is unclear how far their efforts have led.97 It is likely that this is a consequence of lack of industry support.

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Bild ran a headline under “Mad! Press Council reprimands Bild about this arsonist”, http://www.bild.de/news/2007/ news/el-masri-3095854.bild.html 92 p68, lines 7-16; p90, lines 7-17, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/ Transcript-of-Afternoon-Hearing-13-July-20121.pdf 93 And now also includes other media, particularly since the German Press Council expanded their remit to include online newspapers 94 Eberwein, T, ‘Germany: Model without Value?’ in Eberwein et.al, Mapping Media Accountability – in Europe and Beyond, pp77-78 95 Department for Cultural Industries and Media 96 Association anticipating a Press Council 97 Baisnee, O and Balland, L, ‘France: Much Ado about (almost) Nothing?’ in, Eberwein et.al, Mapping Media Accountability – in Europe and Beyond, p71

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2.32

The corollary to the informal systems of self-regulation in France is the application of civil and criminal law. Although the freedom of the press and the freedom of speech are both constitutional principles, uniquely in Europe, privacy laws, in particular Article 9 of the Civil Code,98 are also applicable to the press. Intrusions into privacy, including the taking of photographs of individuals in a public place, are prohibited. Article 9 guarantees the protection of the citizen’s private life, from which the right to one’s image emanates. The Civil Code, however, is fluid in definition in relation to individuals who have a public profile and, in particular, those who hold public office. Under the constitutional guarantees of freedom of speech, French law allows for the publication of information on individuals in public office, as a consequence of their occupation or status. They are presumed to waive rights over the publication of their image, on condition that it is used to inform and not for commercial gain. In French civil law, an individual who feels that their image has been misused can request court action to prevent the attack (through detention, seizure of property, banning the publication, or public denunciation) or seek damages in compensation. In criminal law, invasion of one’s privacy is punishable by a prison term of up to 12 months and a fine of up to €45,000. Historically, the French press has been reluctant to publish stories on the private lives of individuals. Perhaps the most famous example of this phenomenon was the refusal of the French press to publish stories about the extramarital affairs of the former President, François Mitterrand. Suffice to say that nothing was printed about President Mitterrand’s second family, and it was only shortly before his death that the press revealed the facts. There has been a historical willingness to interpret privacy law broadly (and some may argue too broadly) and it has been argued that French privacy law is used to suppress information. However, increasingly French newspapers and, particularly, celebrity gossip magazines are challenging this traditional reluctance to publish content that may be regarded as private and such stories are increasingly the norm in France. The recent publication of the photographs of the Duchess of Cambridge may be part of this trend.99

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Netherlands
2.34 Freedom of speech is set out in Article 7 of the Constitution of the Netherlands. The Constitution also states that the Government has a duty to enable the media to freely exercise their profession without any form of undue influence or interference. This is realised through the Dutch Media Act 2008. Although the Act regulates only public broadcasters and cable operators in the Netherlands, it also ensures that newspapers and internet publications have rights to operate independently and free from Government interference.100 101 The Netherlands has operated a system of self-regulation for the last 50 years. The Netherlands Union of Journalists founded the prototype of a Dutch Press Council in 1948; this functioned originally as a disciplinary body, before being reconstituted as the Raad van Tucht, the

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http://www.legifrance.gouv.fr/content/download/1950/13681/version/3/file/Code_22.pdf The impact of the publication of the photographs of the Duke and Duchess of Cambridge (obtained by a freelance photographer) is described in Part F Chapter 5. The French publication, Closer (owned by the former Italian Prime Minister Silvio Berlusconi’s media company, Mondadori) defends what appears, under French law, to constitute a clear breach of the privacy on the grounds of public interest. On 18 September 2012 an injunction was granted restraining the title from further disseminating or publishing the photographs; the court imposed a financial penalty of €10,000 for each day of failure to comply and ordered the publisher to pay €2,000 in legal costs 100 The Media Act regulates the organisation, finance and responsibilities of public broadcasting in the Netherlands. The rules set in the Dutch Media Act 2008 are upheld by the Dutch Media Authority, known as the ‘Commissariaat voor de Media’, who are responsible for broadcasting but not the printed press. 101 http://www.government.nl/issues/media-and-broadcasting/the-government-and-media/media-act-and-mediapolicy
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Netherlands Press Council (NPC), in 1960.102 This Council describes journalism in the country as a completely free profession, where any individual can be considered a journalist and is not required to be professionally registered as such. 2.36 The NPC does not accept third party complaints. Complaints are only accepted from those who have a direct interest and are affected by the issue and must also be related to a specific breach of the Code. It must concern the journalistic practice of either a professional journalist or someone who, on a regular basis and for remuneration, collaborates on the editorial content of a mass medium. The Council can only pass judgment and is unable to impose sanctions on titles in breach of appropriate journalistic practice. In the Netherlands, and much like the UK, a complainant’s route to seeking compensation is through civil litigation. The fundamental difference between the system of press self-regulation operated in the Netherlands through the NPC and the PCC lies in the prominence accorded to publication of adjudications against titles in breach of the Netherlands guidelines for journalism. The adjudication summaries published by the NPC name and shame journalists who have breached terms on accuracy, or have been found to have crossed the limits of what it is acceptable to publish. These adjudications are published in full on the Press Council’s website, as well as in the Dutch union of journalists’ newspaper, which is widely read by people working in the industry. The decisions are also widely circulated through national news agencies and to other media organisations. This very public naming of titles in breach of the code is seen as a deterrent for poor journalistic behaviour. Although the NPC cannot force a title to publish a correction, the majority of the media will respect such a request from the Council and will comply. Some titles have decided not to publish the verdicts of complaints against them, such as De Telegraaf (the largest newspaper in the country) and NOVA, a current affairs programme on television, who announced that they would no longer cooperate with the NPC. Despite this, 80% of the NPC members have indicated that they would publish adjudications involving their titles. The Chair of the Dutch Press Council has historically been appointed from the Dutch Judiciary. The Chair is assisted by three Vice-Chairs, who are also drawn from the law. The remaining members of the Council comprise 13 industry members (including journalists) and 13 lay members.103 In recent years, steps have been taken to improve the effectiveness of the Council, including an internal review of systems and functions. Changes have included the appointment of five ‘public members’ drawn from the Dutch public at large.104 In order to implement improvements, the NPC has applied for additional financial support from the Dutch Government and has pushed for the adoption of a similar funding mechanism to that used in Germany. The review of systems and functions conducted by the NPC also considered other self regulatory models, including the PCC. Before concluding this summary of the approach of other European countries, it is worth adding that, in her evidence, Ms Fielden observed that Press Councils in Europe are now making concerted efforts to prove to readers that they are concerned with maintaining standards. She gave the example of a judgment by the Swedish Press Council, which ordered

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p1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Exhibit-3-to-Submission-from-theNetherlands-Press-Council.pdf 103 These thirteen members hold a variety of positions in society 104 p2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-from-the-Netherlands-PressCouncil.pdf

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the publication of a decision, which the newspaper title ran on the front page of its publication, as a way of setting the bar:105 “…a Swedish paper that had got something very wrong had been censured by the Press Council and ordered to publish the Press Council decision, off its own bat published it on the front page, and the reason it did that was to say, ‘This is our compact with you, the reader. We are different. We aspire to very high standards. When we get it wrong, we will tell you that we’ve got it wrong, very visibly so.’”

The United States
2.41 In some countries there are no systems of press regulation. The prime and only statutory structure of the United States print newspaper industry is the First Amendment to the American Constitution, adopted in 1791.106 The First Amendment to the Constitution reads:107 “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.” The First Amendment protects both the freedom of speech and the freedom of the press, although there remain certain statutory limitations relating to defamation and privacy,108 as well as certain forms of state censorship, which exempt some areas of free speech from the protections of the First Amendment.109 2.42 By way of example, there are restrictions in both Federal and State law in relation to obscene images (which may be defined to cover material which would not be considered to offend obscenity laws in the UK); there is no equivalent to Page 3. Many US states seek to build on the existing Federal law and place restrictions on the possession, dissemination and sale of obscene material in public places, in particular those where minors may be present such as schools and libraries. The Federal Communications Commission (FCC) is responsible for the regulation of broadcasting across the fifty states and on an international scale.110 The remit of the FCC does not, however, include the regulation of the print media.

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China
2.44 Some witnesses have suggested that any introduction of statute in relation to press standards is tantamount to placing the press under state control. It may be of some benefit to turn very briefly to look at China and the regulation of print media in that country, if only to provide an example of the sort of statutory control of the press that gives rise to these concerns and identify the key features of that regulation to demonstrate how widely and dramatically it

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pp86-87, lines 19-3, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf 106 The First Amendment comprises one of ten amendments in the Bill of Rights 107 http://www.senate.gov/civics/constitution_item/constitution.htm#amendments 108 This includes the Privacy Act of 1974, Privacy Protection Act of 1980, the Freedom of Information Act 1966, and the OPEN Government Act of 2007 109 This includes speech that involves incitement, false statements of fact, obscenity, child pornography, threats and offensive speech, and the speech of others 110 http://www.fcc.gov/what-we-do

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differs from the type of underpinning statute that has been proposed by witnesses to the Inquiry. 2.45 Chinese publications are required under law to abide by a strict registration criteria as well as to undergo a process of continual government approval, exercised by the General Administration of Press and Publications (GAPP). Individual publications are held accountable to the government by official sponsors, defined as a ‘managing institution’, which must be an institution recognised by the Chinese Communist Party or the government.111 The managing institution is responsible for the exercise of control over the publication and content published by it. Specifically, the managing institution should limit any negative coverage of the Chinese Government and the Chinese Communist Party. There are, by definition and in fact, no free or independent media outlets in China. The regulation of the Chinese media by the government is not limited only to the domestic market. Indeed, the Chinese Government seeks to control the content of Chinese language newspapers published abroad. The Epoch Times is a Chinese newspaper founded in 2000 operated from the UK; it provides an interesting perspective on the reach of Chinese press regulation.112 Their submission to the Inquiry suggests that the influence of the Chinese Communist Party extends to the Chinese language print media in the UK and that this influence is exercised through the Chinese Embassy. They have said that the Embassy seeks to influence media outlets targeted at the Chinese community and has sought to discourage its circulation. The Director of the English edition, Sek Halu, has suggested that a number of retailers and supermarkets have refused to stock the Epoch Times because of its critical view of the CCP.113

2.46

3. Reviews of press regulation: Australia and New Zealand
3.1 The development of new media and, in particular, the convergence of delivery platforms for content, has challenged existing models of press regulation, causing some regulators to review the extant regulatory frameworks to consider how best to respond to this changing environment and how new forms of content delivery might be incorporated into existing regulatory structures. In Australia, the structures and functions of the existing Australian Press Council have recently been considered as part of a wider review of press standards, in the context of the Independent Media Inquiry, otherwise known as the Finkelstein Inquiry. The Finkelstein Inquiry has fed into the wider Convergence Review, being conducted by the Australian Government, of regulation across media platforms in Australia and broader media policy. In New Zealand, the Law Commission has looked specifically at the privileges and benefits accorded to traditional media and have considered how these might be applied to new media.

3.2

111

This includes organisations such as the Chinese Federation of Labour, the China Youth League or the All-China Women’s Federation 112 An English edition was introduced in 2005 113 pp1-2, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/11/Submission-from-the-Epoch-Times.pdf

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Australian Independent Media Inquiry: the Finkelstein Report
3.3 The Independent Media Inquiry was established by the Australian Government on 14 September 2011. A former Justice of the Federal Court of Australia, Mr Ray Finkelstein QC, was appointed to conduct the Inquiry. The Independent Media Inquiry invited submissions from any person with an interest in the issue and held public hearings in Melbourne, Sydney and Perth during November and December 2011. In parallel to these hearings, the Chair of the Inquiry also invited selected individuals, organisations, trade associations and other interested parties to make formal submissions. Responses were received from a range of parties, including serving editors of Australia’s major media outlets, former editors with experience of the news media industry, the current Chair of the Australian Press Council (as well as former Chairs), and academics specialising in media and regulation. The timing of the Independent Media Inquiry has overlapped with the establishment of this Inquiry. Although the former was not set up in response to any allegations of wrongdoing at News Limited (the Australian subsidiary of News Corp), or to investigate any press misconduct, it was nevertheless indirectly provoked by the allegations of phone hacking and corrupt payments at News International that led to this Inquiry.114 The Terms of Reference for the Independent Media Inquiry focussed on the efficacy of existing codes of conduct governing media practice in Australia, particularly the likely impact on these of the growing convergence of print media and digital and online platforms. Mr Finkelstein was also required to investigate:115 “The impact of this technological change on the business model that has supported the investment by traditional media organisations in quality journalism and the production of news, and how such activities can be supported, and diversity enhanced, in the changed media environment; ways of substantially strengthening the independence and effectiveness of the Australian Press Council, including in relation to online publications, and with particular reference to the handling of complaints; and any related issues pertaining to the ability of the media to operate according to regulations and codes of practice, and in the public interest.” 3.6 The Independent Media Inquiry concluded its review and reported to the Australian Government on 28 February 2012. Mr Finkelstein recommended that the current Australian Press Council (APC) should be replaced by an independent body, the News Media Council (NMC).116 The role of the NMC would be to ensure that Australian news media operated in a more accountable manner to those who were the subject of press reporting, as well as to the general public at large. To enable the NMC to exercise this function, Mr Finkelstein argued that the NMC should have strengthened remedial powers to deal with complaints about the press. These proposed powers would be significantly greater than those available to the existing APC. Mr Finkelstein also proposed that the NMC should have powers to enforce a right of reply, the withdrawal of an article from further circulation, and the publication of apologies and Council adjudications (including the ability to control the size and prominence of these publications). These remedial powers are, according to Mr Finkelstein, necessary to preserve the integrity of the press.

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Report of the Independent Inquiry into the Media and Media Regulation, pp15-16, paras 1.4-1.7 http://www. dbcde.gov.au/digital_economy/independent_media_inquiry 115 Report of the Independent Inquiry into the Media and Media Regulation, paras b-d, http://www.dbcde.gov.au/ digital_economy/independent_media_inquiry 116 As well as the news and current affairs standards functions of the Australian Communications and Media Authority (ACMA)

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3.7

The NMC would also be responsible for setting journalistic standards, in consultation with the industry, and to handle complaints across all media platforms (specifically print, online, radio and television). Mr Finkelstein proposed a greater level of funding from the Government for the body which would replace the current levy system. He argued that this would remove a current burden on the print industry but would also address the issue of the independence of the NMC from the industry. Perhaps more significantly, and indeed a change of greater significance, Mr Finkelstein also proposed that a legal requirement should be established to grant powers to the NMC to take legal action against any media outlet that refused to comply with the requirements set by the NMC. By way of example, if a publication refused to publish an adjudication issued by the NMC, the Council or the complainant would have the right to apply for a court order compelling compliance from the publication. Any failure by the publication to comply with the court order would be subject to existing legal processes. It is this particular aspect of Mr Finkelstein’s proposals that has been the subject of considerable and heated media criticism. In his concluding remarks, Mr Finkelstein drew comparisons between his review and this Inquiry. He acknowledged that, although the Independent Media Inquiry was not established in response to phone hacking in Australia, they shared the historical experience of a Press Council that had limited powers as a self-regulatory body and was unable to fully bring the press to account in the public eye. Mr Finkelstein has also speculated, in relation to this Inquiry, that:117 “Looking at the matter from afar, it would not be surprising if statutory regulation were top of the list.” Public and Industry Response to the Finkelstein Report

3.8

3.9

3.10

It would be an understatement to observe that Mr Finkelstein’s recommendations have not gone unchallenged by the Australian press. Rather, the Report has led to a wide-ranging and, at times, heated debate as to the nature of press freedom in Australia.118 News Limited’s Chief Executive, Kim Williams, called the Independent Media Inquiry’s report “too draconian” and argued that there was little value in replacing the existing Australian Press Council (APC) with the NMC as proposed by Mr Finkelstein.119 Mr Williams went further and, speaking at the Pacific Area Newspaper Publishers’ Association forum in Sydney, suggested that the Independent Media Inquiry was established by the minority Australian Labor Party Government primarily to attack News Limited, as a direct response to the coverage the Government was receiving in his company’s newspapers.120 Bob Cronin, group editor-in-chief of West Australian Newspapers, also expressed his opposition to Mr Finkelstein’s proposals. He heavily criticised the element of increased oversight of the new Council, as well as the powers of a Government-appointed regulator to control what the media was able to publish. He argued that the proposals were:121

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Report of the Independent Inquiry into the Media and Media Regulation, p211, paras 8.30-8.31 http://www.dbcde. gov.au/digital_economy/independent_media_inquiry 118 The World Today Programme, broadcasted 09 March 2012, ‘Experts debate pros and cons of the Finkelstein Review, http://www.abc.net.au/worldtoday/content/2012/s3449417.htm 119 http://panpa.org.au/2012/09/10/regulation-not-needed-for-diversity-according-to-news-limited-ceo-kim-williams/ 120 http://www.news.com.au/business/breaking-news/news-boss-hits-back-at-media-reforms/storye6frfkur-1226466220012 121 The World Today Programme, broadcasted 09 March 2012, ‘Experts debate pros and cons of the Finkelstein Review, http://www.abc.net.au/worldtoday/content/2012/s3449417.htm

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“…the most outrageous assault on our democracy in the history of the media.” 3.12 A different perspective was provided by the Chair of the current APC, Professor Julian Disney, who has continued to argue for the improvement of resources available to the APC to ensure that it was able to fulfil its complaints-handling responsibilities. He stated that:122 “…resources are hopelessly inadequate and they were even before our number of complaints doubled so it is really just to carry out the responsibilities that we are meant to have and that people expect us to do.” 3.13 In this respect, Professor Disney agreed with many of the central recommendations of Mr Finkelstein’s report which, he suggested, clearly identified the fundamental flaws in the current system of complaints handling through the APC. However, Professor Disney has strongly disagreed with the two particular elements of Mr Finkelstein’s proposals.123 He also drew attention to the absence of any coverage by local newspapers of the APC’s opinions of Mr Finkelstein’s report.124 He stated that no Sydney or Melbourne paper had reported the views of the APC, despite the body being the main focus of the report, or their response to the proposals. He argued that this was a striking example of the lack of balanced coverage that existed in the Australian press. Some commentators have chosen not to focus on the detail of the proposals but have instead considered how the recommendations might be applied in practice, particularly as that Mr Finkelstein concluded the NMC should not be established by statute. Echoing the views of a number of Australian commentators, the former financial journalist Jim Parker, who currently writes for the respected Australian media blog, The Failed Estate,125 argued that, without a statutory backdrop, the powers of the proposed NMC would be without effect.126

3.14

Australian Convergence Review
3.15 The Convergence Review was established in early 2011 by the Australian Government to examine the current system of media regulation in the light of the challenges posed by the conversion of services and the proliferation of media platforms. Specifically, the Convergence Review sought to establish whether a single model could be applied across the media. This review was led by the Convergence Review Committee, chaired by Glen Boreham, former Managing Director of IBM Australia and New Zealand.127 The Committee was also tasked with looking at how the recommendations of Mr Finkelstein’s Independent Media Inquiry might be incorporated into media regulation.128 The Committee reported to the Minister for Broadband, Communications and the Digital Economy, Senator Stephen Conroy, on 30 March 2012. The Convergence Review Committee recommended that any media title, regardless of the platform on which their content was delivered, should be subjected to certain restrictions by a

3.16

3.17
122 123

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ibid Specifically, the formal powers of the News Media Council to compel publications to act in accordance with the NMC requests; and the strengthening of the Council’s resources through full government funding: http://www. presscouncil.org.au/uploads/52321/ufiles/APC_Media_Release_-_The_Media_Inquiry_Report.pdf 124 The Australian Press Council’s response to the report were published only in the national papers 125 http://thefailedestate.blogspot.com.au/2012/03/freedom-from-press.html 126 http://www.abc.net.au/news/2012-03-05/drum-wrap-media-inquiry/3869106 127 http://www.dbcde.gov.au/digital_economy/convergence_review/committee_profiles 128 the recommendations of the Australian Law Reform Commission’s review into the National Classification Scheme were also considered by the Convergence Review

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single regulator.129 In this respect, the Committee proposed that the licensing of broadcasting services should cease, and the regulation of the media should be undertaken by a single statutory body which would replace the existing Australian Communications and Media Authority (ACMA). The new regulator would be responsible for any media enterprise, across all platforms, defined as ‘content service enterprises’; this means organisations that:130 “…have control over the professional content they deliver; have a large number of Australian users of that content; and have a high level of revenue derived from supply that professional content to Australians.” 3.18 In this regard, the Convergence Review recommended that thresholds should be defined in relation to the annual revenue of a concern, as well as the number of readers (or ‘hits’) any media title attracts within the Australian market.131 By setting these thresholds, Australia’s 15 largest media companies would be subject to regulation by the new body. Ms Fielden noted in her evidence to the Inquiry that online operator, Google, would be exempt from this definition, despite the company’s reach within the Australian media market. This was due to the stipulation that saw Google’s revenue understood in terms of professionally produced material, rather than as a content service enterprise.132 The Committee’s proposals did not, however, take forward the recommendation of the Independent Media Inquiry to establish the new News Media Council. Rather, it proposed an industry-led body for maintaining news standards across all media and communications, in the stead of the Government-appointed regulator proposed by Mr Finkelstein. This was in addition to the recommendation for a statutory regulator to replace the ACMA. At the time of writing, the Australian Government was still considering the recommendations of both Committees. However, whatever the eventual Government response, it will no doubt alter the regulatory landscape of Australia in relation to the convergence of print, broadcast and online media. Public and Industry Response to the Convergence Review 3.21 There has been a mixed response from the industry to the recommendations of the Convergence Review. Although these recommendations have not generated the same levels of controversy and debate as those put forward by Mr Finkelstein, a number of commentators saw the proposals as part of a continued, and in some cases deliberate, erosion of the freedom of the press.133 In her evidence, Ms Fielden drew the attention of the Inquiry to the response of some parts of the Australian press, which have argued that the Convergence Review was purposefully established in order to regulate the fifteen companies which would fall under the definition of ‘content service enterprises’, and has been otherwise unconcerned with other areas of media regulation that ought to have been considered more fully by the review. Ms Fielden disputed the validity of this assessment of the Convergence Review.134

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129 130

Whether it is online, broadcast or in print Convergence Review, Final Report, published 30 March 2012, http://www.dbcde.gov.au/digital_economy/ convergence_review 131 This would exclude any small or emerging content provider 132 pp78-79, lines 21-9, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-of-AfternoonHearing-13-July-20121.pdf 133 For example, submissions by: Newspaper Publishers Association, http://www.dbcde.gov.au/__data/assets/ pdf_file/0020/146351/Newspaper_Publishers_Association.pdf; and News Limited, http://www.dbcde.gov.au/__data/ assets/pdf_file/0006/146283/News_Limited.pdf 134 pp78-79, lines 24-4, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf

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3.22

Ms Fielden also told the Inquiry of the recent changes implemented to improve the function and practice of the Australian Press Council (APC), introduced in response both to the Convergence Review and the allegations of wrongdoing, in particular the allegations of phone hacking that led to the establishment of this Inquiry. She said that the Council had actively responded to the calls for reform of press regulation, and had proactively sought to consult the Australian public in order to determine how best to hold the press to account. This had led the APC consciously to shift its focus of activity to the maintenance and improvement of press standards, ensuring the fair balance of the Journalists’ Code and the mediation of complaints. The APC had appointed an advisory board tasked with monitoring the coverage by news media of issues which were likely to give rise to a substantial number of complaints.135

New Zealand Law Commission Review
3.23 The New Zealand Law Commission Review examined the legal and regulatory environment in which the media operated in New Zealand and, specifically, the privileges that existed for print media and whether these should be extended to their online equivalents. Such privileges included legal rights to the protection of sources and others relating to court proceedings. The Review tried to set a framework which defined who should benefit from these privileges and how. The Terms of Reference were to examine the following questions:136 “how to define ‘news media’ for the purposes of the law; whether, and to what extent, the jurisdiction of the Broadcasting Standards Authority and/or the Press Council should be extended to cover currently unregulated news media and, if so, what legislative changes would be required to achieve this end, and; whether the existing criminal and civil remedies for wrongs such as defamation, harassment, breach of confidence and privacy are effective in the new media environment and, if not, whether alternative remedies may be available.” 3.24 The New Zealand Law Commission provided a list of preliminary proposals, published in December 2011, and has since invited submissions in relation to these proposals. The proposals included the suggestion for a statutory definition of ‘news media’ (to include new media), specifically for the purposes of defining which publications should be entitled to the rights of the legal privileges and exemptions. The Review also proposed the establishment of a new independent regulator, responsible for all news media, regardless of the format or delivery platform. In relation to the existing civil remedies for victims of mistreatment by the press or other media, the Review proposed the creation of a Communications Tribunal, which would handle complaints in the context of the changing publishing environment. The Law Commission’s preliminary Report was published to encourage wider public debate, as well as to generate feedback on the scale and scope of initial solutions. By way of example, the Law Commission produced two options, for consideration by the public and stakeholders, as to whether membership of the new body should be enforced by statute or remain voluntary. The consultation period ran from December 2011 to March 2012.137 The paper and accompanying proposals are currently being considered by the New Zealand Government which, similarly to the Australian Convergence Review, is due to report in Autumn 2012.138

3.25

135 136

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pp73-74, lines 10-11, Lara Fielden, ibid The News Media Meets ‘New Media’: Rights, Responsibilities and Regulation in the Digital Age, published December 2011, http://ip27.publications.lawcom.govt.nz/uploads/files/downloads/LC-IP27-ALL.pdf 137 http://www.lawcom.govt.nz/project/review-regulatory-gaps-and-new-media?quicktabs_23=issues_paper 138 p94, lines 12-16, Lara Fielden, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Transcript-ofAfternoon-Hearing-13-July-20121.pdf

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Concluding remarks
3.26 The alternative models of press regulation, as well as the other recent international reviews, have provided helpful examples of the different possible solutions for this Inquiry to consider. It is possible, however, to argue that there has been no compelling evidence to demonstrate that any of these models, or combinations of them, would function better than any others. It is clear, however, that all the structures considered in this Chapter are embedded in the social, cultural and historical functions of the media in each country, and are not necessarily ideal structures to apply to the UK. It is also worth noting how many countries are currently considering the impact of the evolution of digital platforms, as we have seen in Scandinavia and further afield in Australia and New Zealand. This development of online media content, as well as methods of delivery, has brought the regulation of print media into a whole new context. Although some of the practices revealed by the Inquiry may not be faced by other countries, the overarching questions being addressed are not unique; but neither is it possible to pretend that any other system, inquiry or review has successfully developed an ideal solution to the problems being faced.

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Chapter 6 teChniques of regulation
1. Introduction
1.1 Part K, Chapter 1 sets out the criteria that I consider need to be met by any ‘new more effective regulatory regime’. Chapters 2-4 look at specific proposals that have been made for a new approach to regulation of press standards, and Chapter 5 looks at the way that other countries deal with press standards. This Chapter starts from a rather different position and looks at the theoretical framework for regulation. This does not purport to be a definitive text on the theory of regulation; rather it is a brief look at the different ways in which regulation can be achieved and the circumstances that are conducive to different approaches to regulation being effective.

2. Regulatory options
2.1 The Terms of Reference talk about making recommendations for a new and more effective policy and regulatory regime and that it precisely what this Report aims to do. There has been a lot of talk in the media and elsewhere about the regulation of the press versus selfregulation of the press as though that were a binary choice. That is not an interpretation that I accept. It seems to me that there is a wide spectrum of action that can be undertaken, and that, far from a binary option there is a continuum from no regulation at all, through to full statutory regulation: a solution can be accessed at any one of a number of points on that range. This chapter considers, from a theoretical perspective, the various policy and regulatory tools that are available for use and looks at the pros and cons of each, though I must reiterate that this is a partial review of the options, not a thorough analysis. At the opening of the Inquiry a number of briefing sessions were held that dealt with the factual background against which the issues under consideration by the Inquiry should be seen. At one of those briefings Donald McCrae, an expert in regulatory theory, introduced a model for thinking about regulatory propositions.1 Specifically, he categorised the potential approaches to changing behaviour under four headings: engage, enable, encourage and exemplify. At the same time the Inquiry heard from a number of regulators about different regulatory regimes and about the different regulatory regimes for the press and the media in other countries. This Chapter starts by considering different ways of securing behavioural outcomes, drawing on examples where that is helpful. This is a technical consideration of potential models and how they might operate. The Department for Business Innovation and Skills (BIS) sets out general principles of regulation, which requires that any regulation and enforcement framework should be capable of being implemented in a fashion which is demonstrably proportionate, accountable, consistent, transparent, and targeted.2 There are various ways of categorising regulatory models. One way of doing so is to look at the level of external intervention. This can be cut at almost any level of specificity but we

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Donald McCrae presentation, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Donald-Macrae1.ppt BIS, Principles of Regulation, http://www.bis.gov.uk/policies/bre/principles-of-regulation

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have identified four levels which we go on to consider in more detail, namely no regulation, self-regulation, co-regulation and, finally, statutory regulation.

No regulation
2.6 This concept needs some clarification. For most people ‘no regulation’ would mean no specific regulation or laws relating to the press. However at present the media are bound by the law as it applies to the rest of us. This includes many laws that could impact on the sorts of behaviour in the press that have been complained of in evidence to the Inquiry, such as Regulation of Investigatory Powers Act 2000 (RIPA), under which the prosecutions for phone hacking have been made, the Bribery Act 2010, the Fraud Act 2006, the Protection from Harassment Act 1997 etc. Critically, the Human Rights Act 1998 provides rights both to a private life and to freedom of expression. There are additional laws relating to press reporting on criminal cases. The media are also subject to the Data Protection Act 1998, although there is a specific public interest protection under section 32 for processing data with a view to publication for journalistic purposes. So the concept of ‘no regulation’ should not necessarily be considered to mean that journalists would be able to operate unfettered by legal constraints.

2.7

Pros and cons
2.8 The principles of better regulation dictate that regulation should be ‘proportionate’ – i.e. no more than is required to achieve the policy objective. Clearly if it is possible to deliver the desired outcome in the absence of any regulation then no regulation should be introduced. In practice this means that ‘no regulation’ is an appropriate response when the market is capable of delivering the required outcome without intervention. The very fact that this Inquiry had to be established, in the wake of discoveries of serious wrongdoing and criminality, in at least one national newspaper, is sufficient demonstration that the market alone will not provide public protection from criminal acts which Parliament and the public have regarded with abhorrence, and which even those responsible for committing them have not sought to justify in this Inquiry. Furthermore, the law has to be accessible for if there is limited prospect of detecting criminal behaviour or being able to afford civil proceedings, to that extent, there is no sanction (or, in the absence of ethical standards) disincentive to comply with the law when to do otherwise has potential advantages. Thus, if there is a good prospect of being able, say, to intercept mobile phone communications without being caught (because of the care taken to avoid alerting the victim and, in the absence of a victim, law enforcement will not be engaged) and the advantages to be obtained from listening to intercepted messages are sufficiently beneficial, the fact that others in the market do not engage in that behaviour will not necessarily prevent it.

2.9

Self regulation
2.10 There are many different self-regulatory tools. This section considers self regulation in the purest sense, where activity is entirely voluntary, where there is no constraint or oversight from outside of those self-regulating as to the standards that are set or monitoring or enforcement of compliance with them. There are a number of tools that could potentially fall within the definition of self-regulation.

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Internal governance 2.11 The first is referred to as ‘internal governance’; these are the methods that organisations use to establish their own cultures and control behaviour within their own organisations. What happens inside a company is a matter of culture, example, practice and control, and these internal governance practices and procedures are likely to have the most significant impact on the ethical standards applied by their employees and contractors. The Inquiry has been provided with extensive evidence from newspapers about systems that they have in place to ensure compliance with ethical standards. Internal governance is likely to be very effective in circumstances where it is genuinely in the interest of the organisation to secure compliance with the standards. It is less likely to be effective if there are competing incentives (for example if the financial benefits of breaching the standards are significant). To be effective, internal governance systems must be consistent, must be seen to be enforced and must be seen to be exemplified throughout the organisation. The Inquiry has also seen evidence3 of many excellent systems of internal governance in place in both national and regional newspapers. It is noticeable that the formal governance arrangements in the News of the World, prior to its closure, were effectively the same as those for other titles in the News International Group, which are themselves similar to the best examples of internal governance arrangements that we have seen. I draw two lessons from this. First, internal governance can have an important role to play but, second, formal internal governance procedures are not in themselves sufficient. It should also be noted that, whereas the detail of day to day governance processes are very much a matter for companies individually, governance is not itself a purely self-regulatory matter as some elements of corporate governance are dictated by company law, or stock market listing requirements. The extent to which these rules impact on companies running newspapers is, of course, affected by the different ownership structures which they enjoy. Industry standards 2.14 The second purely self-regulatory tool is industry standards. With a purely self-regulatory industry standards model there is no compulsion for anyone to be a member, no oversight from outside the membership of the standards set or enforcement procedures, and no fallback either where relevant bodies are not members or where the self regulatory standards are not enforced. This is the model currently in place with the Press Complaints Commission. It is worth noting that many professional bodies often regarded as ‘self-regulatory’ (such as the General Medical Council, the Solicitors’ Regulatory Authority etc) are not self-regulatory at all. Their powers spring from legislation that restricts the practice of the profession and gives the bodies the right to prevent those who fall sufficiently short of professional standards from practising the profession. Similarly, whilst the Royal Institute of British Architects (RIBA), which was suggested as a model of self-regulation4 at one of the seminars held by the Inquiry, is a self regulatory body and architects do not have to belong to it, they do have to be registered with the Architects Registration Board (ARB) in order to use the term architect and the ARB issues a code of professional practice and can take action against those who fail to comply. For that reason, these models of professional regulation are not considered here. There are many examples of industry groups who have come together to agree codes of practice that all are willing to adhere to. These codes are likely to require members to follow

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2.15

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Part C, Chapter 2 http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Presentation-by-Eve-Salomon-PDF-23.4KB1.pdf

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particular courses of action; in the context of this report this is most relevant where the action is aimed at consumer protection. Such bodies may produce a kitemark or similar badge which is intended to represent to the public that the members who are able to display the kitemark adhere to an appropriately high standard of behaviour in the course of their work, whatever that may be. 2.17 It is generally accepted that industry self-regulation is often more flexible and less costly for both business and consumers than direct government involvement. There are two principal reasons for this. Industry experts can be expected better to understand their own processes and capabilities and also have better insight into consumer needs and responses to their particular products or services than an outside or external regulator would. Self-regulation also allows industry to adapt and react to technological and market change, and consumer behaviour, at a speed that formal regulation can rarely match. If effective, this should result in better outcomes for both consumers and the industry. However, for self-regulation to be effective there needs to be an appropriate alignment of incentives to make it so. In practice these incentives tend to be the existence of a market need, and the absence of legal rules or regulation to address that need, coupled with a fear that the imposition of such rules would have a damaging effect on industry players. Ofcom research has found that most self-regulatory schemes have been established, at least in part, in response to a perceived threat of state intervention.5 The PCC, established in the wake of the Calcutt Report in 1990, as the now notorious ‘last drink in the last chance saloon’ is no exception. For incentives to align, more is needed than simply the existence of a problem and a threat of state intervention. Self-regulation is more likely to be effective in those markets where: 6 (a) “companies recognise that their future viability depends not only on their relationship with their current customers and shareholders, but also they operate in a environment where they have to act responsibly within the societies in which they operate; and; companies recognise and acknowledge the identified problems which may cause harm or market failure that impede citizens or consumers; and; companies, individually and collectively, acknowledge the need to reduce the identified harm or market failure, since this will improve the ability of those companies to determine the interests of citizens or consumers and, potentially, society as a whole.“

2.18

2.19

(b) (c)

A fourth criterion could be added: (d) 2.20 addressing the perceived harm is not in direct conflict with providing the desired service to the companies’ consumers.”

It is worth exploring this concept a little further. Most self regulatory regimes are aimed at dealing with the impact that the relevant organisations have on those who use their services, or at least where the consumers of their services would be expected to disapprove of the impact concerned. Examples include Association of British Travel Agents (ABTA) or other kite mark institutions, whose aim is to provide a guarantee of quality to consumers. It is in the interests of all members of a kitemark group to ensure that the standards promised by the

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http://stakeholders.ofcom.org.uk/binaries/consultations/coregulation/summary/condoc.pdf para 2.24, http://stakeholders.ofcom.org.uk/binaries/consultations/coregulation/summary/condoc.pdf

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mark are upheld consistently because failure to do so will damage consumer trust in their own product. 2.21 A different example is the Internet Watch Foundation (IWF) where Internet Service Providers (ISPs) co-operate not only because the majority of their customers do not themselves want to be exposed to images of child abuse, but also because it is very much in their interests not to be seen to be providing access to such images to those who do want to see them. The potential for successful self regulation is reduced where the harm complained of is to a third party and does not obviously damage the interests of the companies concerned or their consumers. Obvious examples of this would be the use of child labour, or casual dumping of waste leading to environmental damage. Such activities might lead to higher profits and cheaper products, so pleasing both producers and consumers. The fact that they have a wider social cost that is not generally considered acceptable may be sufficient to prevent this type of behaviour but, equally, it may not be if the relevant company believes that it can achieve its ends (albeit causing the harm) in secret and without being detected. It might be argued that public concern over the wider social costs would be enough to lead to a successful self regulatory outcome, but the continued sale in the UK of products that are made by child labour, or the production of which leads to environmental degradation in its country of production, whilst strict laws in the UK prevent such things from happening here, is testament to the difficulty of achieving pure self-regulatory outcomes that might be in the wider public interest, when direct consumer interests do not align with the wider public interest. A less extreme example might be online copyright infringement. The growth of the internet has led to widespread habits of sharing music and film (and increasingly books and magazines) online through informal, unlawful, channels rather than buying them from legitimate sites. This is breach of copyright and deprives the creators and the creative industries of the legitimate revenue that they need to reinvest in the production of new content. The Government looked for self-regulation among ISPs to find ways of preventing internet users from engaging in these unlawful activities. However, the harm does not affect ISPs, and providing a solution was likely to be unpopular with their consumers who are precisely the people engaging in, and (in their eyes) benefiting from, the unlawful behaviour. In the absence of a self regulatory solution, Parliament passed legislation requiring action from ISPs because they believed the wider public interest required a solution to be put in place even though neither the service providers nor their consumers had any incentive to co-operate. The relevance of this final point to the situation with the press is obvious. The Inquiry has heard evidence that the PCC is good at some things, such as mediation, and not at all effective in relation to others.7 Similarly we have heard evidence from editors8 that the continued purchase of newspapers by the public is proof that the public is satisfied with the standards that obtain. We have also heard substantial evidence of the harm that newspaper behaviour has done to many individuals: these include some who have put themselves in the public eye deliberately, some who are there incidentally because of a famous friend or relative, some who find themselves well known because of terrible things that happen to them and yet others who become the subject of media interest purely by freakish chance. None of this is about harm done to readers, that is to say the people whose purchasing decisions apparently tell the editors that they are making the right call; it is all about harm to third parties who have no voice in that transaction.

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The Inquiry has had representations from members of the public complaining more generally about the content of newspapers; the complaints include a diverse range of press activities such as the sexual objectification of women, the vilification of migrants and the abuse of the disabled.9 These cases also raise questions of a wider public interest than purely what any given portion of the public might like to read about and therefore whether consumers are getting fair treatment. Harm of this sort is less susceptible to effective self-regulation than harm as part of the producer/consumer contract. Ofcom also argues that self regulation is more likely to be effective where citizens or consumers and all other individuals share common views as to the merits of regulating the activities of companies to achieve a particular social objective. The vigorous debate that has raged over these issues as the Inquiry has gone about its business suggests that this criterion is not met in relation to press regulation, in particular as it applies to privacy. Finally, self-regulation will be more able to succeed in a market environment with active participation by the industry. In those circumstances, cohesiveness is most likely to administer effective self-regulation as industry participants are more likely to commit financial resources, consult with stakeholders and monitor the effectiveness of self-regulation. This, at least in part, does appear to be the case in relation to the press, with the market having been able to sustain the existing funding mechanism for the PCC (through PressBoF) since its creation in 1990. Self-regulatory industry bodies tend to have few sanctions other than expulsion from the body. Levels of monitoring of compliance and enforcement vary. There are various options as to how compliance could be monitored. One option is simply rely on members to comply with the relevant standards. A second would be to require self declaration of compliance and a third would be to have independent verification of compliance and/or enforcement mechanisms. The PCC runs a reactive approach, relying for the most part on members to police their own compliance, with a reactive, complaints-based, enforcement mechanism and an Independent Review which can consider appeals concerned with the PCC process (but not on the substance or merits of the complaint or the adjudication).

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User regulation
2.30 A further form of self-regulation is regulation by the user community. Many online services are seen to be self-policing. An obvious example is Ebay, in which users rate the service they have had from members either as buyers or sellers in order to enable users to buy and sell with trust. Similarly the operators of other online sites invite users to self-police by reporting breaches of terms and conditions, with the service provider which then takes action when notified. This mechanism can work well where it is in the interests of users to provide feedback on inappropriate behaviour, and where there are quick and simple mechanisms to do so. It is thus a relatively good tool in some online environments but less likely to be effective in the physical world.

Co-regulation
2.31 Co-regulation means any form of self-regulation with some sort of external, independent, incentives, oversight or form of backstop. There are many different ways in which the backstop can be provided and they will have different impacts. These can include recognition

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of a self-regulatory body by Government, law or a statutory regulator; approval of codes by Government or a statutory regulator; and compulsory membership or funding arrangements. Variations on each of these models exist in different sectors in the UK and elsewhere and the model is almost infinitely variable. The basic variations are explored. Recognition of self regulation/regulatory backstop 2.32 The circumstances in which incentives might align to make self regulation effective are described above. A further incentive for co-operation with self-regulation can be provided in the form of recognition by the courts or a regulator of the process of self-regulation. The Advertising Standards Agency (ASA) is an example of co-regulation, where the agency act as the regulator in relation to both print and broadcasting advertising. In the case of print advertising, the Office of Fair Trading (OFT) has statutory powers to deal with misleading advertising and in the case of broadcast advertising, Ofcom has statutory powers through its licensing regime. However, both statutory regulators recognise the role of the ASA and only take action in relation to advertising issues when referred to them by the ASA. Specifically, the Control of Misleading Advertisements Regulations 1988 require the OFT, before considering a complaint about the misleading nature of an advertisement to satisfy itself that ‘such established means as the Director may consider appropriate’ have been used and have not dealt adequately with the complaint and that he should have regard to the desirability of encouraging the control, by self-regulatory bodies, of advertisements. The ASA does not, therefore, have statutory recognition itself, but the statute sets the framework within which the ASA can be given the space by the OFT to operate. This sort of approach has many advantages. First, it brings all the advantages of self regulation (efficient regulation, speed of response, flexibility in the light of social and technological change). Second, it provides an incentive for industry to comply with the standards and rulings of the self-regulatory body since the alternative is to face a regulatory process with the regulator. Third, it provides an incentive for industry players to ensure that the self-regulatory body is credible, since the regulator can only accept the rulings of the self-regulatory body if that body deals satisfactorily with complaints. Finally, it provides a backstop in the case of those parts of the industry which might chose not to comply with the standards or rulings of the self-regulatory body but who are, none the less, subject to the law and to the jurisdiction of the regulator. On the other hand, this approach does require the basic ground rules to be set in legislation. It requires the existence of a regulator capable of acting as a backstop and it leaves open the possibility of conflict between the regulator and any self-regulatory body over what standards should apply, within the legislative framework. A basic framework approach of this sort could allow for two or more self-regulatory bodies running different codes or standards as long as the regulator was content to recognise both, but it would also allow the regulator to favour one self-regulatory body over another. In practice, it may be felt that it is easier to arrive at an ASA model where a strong industry self-regulatory body already exists, but requires some legislative underpinning in order to ensure appropriate standards are set and maintained without exception across the industry, than in the case where a new self-regulatory body would have to be called into being. In the absence of a credible self-regulatory body, the regulator might have to develop codes and standards itself, in order to provide appropriate predictability, consistency and transparency in the market. In the online copyright infringement example mentioned above, the legislation requires Ofcom to seek to approve an industry code, but provides that in the absence of an
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appropriate industry code Ofcom should impose a code of its own that meets the requirements of the statute. In that model, a structure which appears, on the face of it, to provide a coregulatory approach in practice (depending on the circumstances) can end up delivering a statutory regulatory outcome. 2.37 It is possible to imagine a lighter touch regime than the ASA version. For example, the courts could be required or encouraged to consider compliance with the standards of a self regulatory body as a sufficient defence against a relevant complaint. For example, if a regulatory body established a process for considering the existence of a public interest before engaging in activity that might otherwise constitute a breach of privacy then the courts might consider that compliance with that process demonstrated (at least prima facie) sufficient grounds to give rise to reasonable view that the public interest was engaged and the intrusion was legitimate. On the one hand, a co-regulatory model can encompass anything that could be done under self-regulation whilst adding an element of compulsion to make effective enforcement possible. On the other hand, it can encompass anything that could be done by a statutory regulator but put relevant decision making in the hands of those closest to the industry, and rigorously separate from Government, to seek to gain the benefits of self-regulation without losing the benefits of statutory backing. This is a model that is much in use in the UK. Most professional regulation is co-regulation by this definition where the practice of the profession (law, medicine, architecture etc) is protected by law and the professional bodies that, police it do so with the statutory backing that allows them to rescind or refuse a license to practise. Advertising is a well known example of successful co-regulation. Others include ATVOD, PhonePayPlus and the ACAS Code of Practice on Disciplinary and Grievance Procedures.

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Statutory regulation
2.39 In this Report a reference to statutory regulation means a system where the scope and coverage of the regulation is set by statute. Again, there is a broad spectrum. At one end is the situation where the full detail of the regulation (in fact, law) is set by statute with enforcement by the police or otherwise through the courts. At the next level, is the regime where most of the detail of the regulation is set by statute, but with a regulator acting primarily as an enforcement body: many consumer protection regulations, with OFT regulating, fall into this category. Then there is the case where the regulator is established by statute and given objectives to meet, along with the tools with which to do so, leaving the regulator to set the detail of the regulations, to make regulatory decisions and then to enforce them: most sectoral regulators such as Ofcom, Ofgem, and Ofwat fall into this category. In some models the regulations set by the regulator might themselves need to be approved by Parliament. In others the regulator is free to manage the regulatory regime without external oversight but subject to appeal though an appropriate judicial body. Statutory regulation, with the legitimacy of Parliamentary debate and approval, represents the will of the people to impose certain standards of behaviour. Statutory regulation is primarily used to address circumstances where horizontal law is insufficiently precise to deliver the outcomes required and, where the nature of the problem to be resolved is such that the operation of the market is not likely to deliver the solution. This is the case, for example, where there is a high degree of concentration within an industry, leading to the possibility of anti-competitive behaviour with negative impacts for consumers. It is also unlikely that the market alone will provide appropriate consumer protection where companies take a short-

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term view of the factors influencing their viability and are focused predominantly on the interest of their current customers and shareholders. 2.41 Statutory regulation is an effective way of dealing with issues relating to the impact on third parties of activities outside the commercial relationship involved. Legislation can be used to require parties to take into account broader social or public interest issues that would not otherwise form a part of their commercial consideration of their interest. To express that in more economic language, this is where external costs arising from the activities of the companies are borne predominantly by sections of the society other than by the customers of those companies and the companies themselves.

3. Regulatory tools
3.1 The previous section considers different ways in which regulation can be delivered. This section aims to consider the types of tools that can be used. Most of these tools could form part of any regulatory tool kit whether it was self-regulatory, co-regulatory or statutory regulation. The purpose of regulation is to deliver an outcome that society wants. However, regulation is not the only way to influence or change behaviour. I thus turn to the categorisation identified by Mr McCrae of the different ways in which changes to behaviour can be encouraged and influenced, namely: enabling, engaging, exemplifying and encouraging.

3.2

Figure K6.1
Approach evolves as attitudes and behaviours change over time
• Remove barriers • Give information • Provide facilities • Provide viable alternatives • Educate/train/provide skills • Provide capacity Enable

• Tax system • Expenditure – grants • Reward schemes • Recognition/ Encourage social pressure – league tables • Penalties, fines & enforcement action

Catalyse
Is the package enough to break a habit and kick start change?

Engage

• Community action • Co-production • Deliberative fora • Personal contacts/ enthusiasts • Media campaigns/ opinion formers • Use Networks

Exemplify • Leading by example • Achieving consistency in policies

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Source: Donald McCrae, slide 3, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/ Donald-Macrae1.ppt
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Enable 3.3 This includes removing barriers (of whatever sort) to the desired behaviour, giving information and providing viable alternatives, including through capacity building, skills, training and facilities. Two different aspects of press culture have been raised with the Inquiry: on the one hand, there is behaviour that breaks the law or is, in some other way, in breach of recognised, accepted standards (which, in shorthand, I refer to as unethical), and on the other hand, there is concern that the press is not sufficiently engaged in genuine investigative work. The Inquiry has not heard any evidence to suggest that there are barriers preventing lawful or ethical behaviour, as opposed to pressures encouraging unethical behaviour. The Inquiry has, however, heard arguments10 that there are barriers in place that make it difficult for the press to pursue legitimate investigatory journalism, in particular current libel laws, the new Bribery Act and uncertainty over the interpretation of the public interest. There is no doubt that newspapers are largely operating in an increasingly challenging economic environment, with the need to compete with 24 hour news and the internet. Newspapers are now required not only to fill their printed pages on a daily (or weekly) basis but also to provide constantly updated content on websites and they do this with reduced numbers of journalists. In this context, issues around resourcing and training of journalists are clearly highly relevant. Engage 3.5 Another route to changing behaviour is to leverage the enthusiasm and commitment of interested parties. This involves community action, media, opinion formers and using networks. There is clearly substantial interest from MPs, the public, academics and pressure groups in the issues of press culture and ethics. The Inquiry has seen no evidence of a lack of engagement on the part of those outside of the media. On the other hand the partial approach to reporting in the press either the extent (or even the existence) of problems with press ethics has been exemplified by reporting of the phone-hacking scandal from the very beginning. It is widely, and rightly, recognised that there would not have been the public concentration on these issues of press culture and ethics had not an investigative journalist, (Nick Davies), with a support of national newspaper (The Guardian), not pursued phone-hacking determinedly. On the other side of the scale, the rest of the press, together with the PCC, were keen to paint the Mulcaire case as that of one rogue reporter.11 The nature of the problems identified by the Inquiry suggest that the tools of engagement, whilst potentially complementary, are unlikely to be sufficient by themselves to change behaviour.

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p21, lines 14-21, Nick Davies, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Transcript-ofAfternoon-Hearing-29-November-2011.pdf p2, Alan Rusbridger, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/11/Alan-Rushbridger.pdf 11 It is also possible to point to the way in which the Inquiry has been reported, in particular relating to the different arguments for alternatives to improved self regulation along the lines proposed by PressBoF. The press is, of course, entitled to be partisan but the extent to which there has been any balanced discussion or analysis of the arguments is, at least, open to debate

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Exemplify 3.8 Exemplification includes leading by example and achieving consistency in policies. The Inquiry has heard many references to examples of excellent journalism and adherence to excellent ethical standards within the British press. The Inquiry has, however, heard fewer instances of use of such examples of excellence within the industry to promote ethical behaviour. The PCC receives complaints and, unless mediated, produces adjudications on them which lead to reminders to papers and journalists of the nature of the code and the production of additional guidance on good behaviour. The Inquiry has been told of many examples of excellent investigative journalism, ethically conducted, being lauded within the industry: examples include Thalidomide, phone hacking and MPs expenses. However, on the other hand there appears to be no particular censure for unethical behaviour: for example, even after the decision of Eady J awarding damages for breach of privacy to Max Mosley, in which the activities of the chief reporter were heavily criticised, the News of the World (NoTW) put that story forward for the title of scoop of the year.12 The NoTW did not win (the Times won the title that year) but the story suggests that NoTW did not expect accuracy or ethical standards to be a material factor in deciding the winner. Again, the nature of the problems the Inquiry has heard suggest that, whilst best practice will certainly have a role to play, it is unlikely to be sufficient to address all concerns. Encourage 3.10 In the context of this list of mechanisms to change behaviour, ‘encourage’ includes all regulatory measures, including through the tax system, transparency requirements, penalties and enforcement measures and positive approaches such as reward schemes and targeted grants. Some of these tools are rewards for good behaviour, others sanctions for bad. Some might be seen to work both ways. Public money can be provided either to fully fund activity seen as desirable (e.g. the BBC) or in other ways. Examples from the broadcasting sector include Channel 4, which is publicly owned, and has historically been funded both by its own commercial income and by subsidies levied from other public service broadcasters and other terrestrial broadcasters who have access to spectrum to broadcast and in return have to meet public service broadcasting requirements. There is less tradition of the state funding the press, though many local authorities publish newsletters which are distributed to the local population and which contain council news, sometimes other local news and advertising. All books and newspapers are exempt from VAT, whilst online publications are not. In addition Royal Mail operates a specific tariff (presstream) for distribution of newspapers and magazines. Governments can provide public money for grants to encourage all sorts of behaviour, from grants for film production to the car scrappage payments, from the solar power feed-in tariff to help with starting up small businesses. Grants and other payments can be used to encourage behaviour change by citizens, consumers or businesses of any size.

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pp55-56, lines 15-1, Colin Myler, http://www.levesoninquiry.org.uk/wp-content/uploads/2011/12/Transcript-ofAfternoon-Hearing-14-December-2011.pdf
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3.14

Newspapers and magazines are substantial recipients of public subsidies in some countries. In France, for example, the press received €20m in subsidies in 2008,13 with all forms of aid to the press estimated at €1.2bn.14 These subsidies take the form of direct payments for technological improvements, subsidised travel for reporters, reduced mailing rates for newspapers, tax advantages etc. Some subsidies are direct grants, others are repayable loans. In addition a new scheme was started in 2010 to provide free newspapers to young people (one free copy a week; distribution is also paid for by the Government); this is an attempt to persuade the new generation to develop the habit of reading newspapers. Sweden also provides direct subsidies to the press (around €61m in 2009),15 as do Denmark (around €44m in 2008)16 and Norway (around €35-40m in 2005)17 both directly and in the form of tax exemptions. The tax system is one way of incentivising desired behaviour. In general, in recent decades UK Governments have taken the view that the corporate tax system should by used in this way only to address horizontal market failures, e.g. in relation to R&D. There are exceptions (the tax relief for film is one example) but these are not widespread and there is little appetite to increase them. The Inquiry has heard suggestions that the VAT exemption could be used as a mechanism to encourage compliance with a self-regulatory approach to standards, but there are overwhelming legal problems with that idea.18 Also under the ‘encourage’ heading is the wide range of more direct regulatory steps that could be taken. These are addressed below. Transparency

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Transparency is valuable in a situation where consumers or others need information to take relevant decisions. This could work in two ways. It can take the form of transparency of action (e.g. requiring all stories to run under the byline of a real person; requiring transparency on the sources of quotes, requiring transparency on the method by which any story has been obtained). It can also take the form of transparency of compliance (e.g. requiring visible corrections, publishing accuracy league tables, publishing data on compliance with regulatory standards). The advantage of transparency as a tool is that it enhances the effectiveness of the market by reducing information asymmetry and putting consumers in the position of being able to take a judgment on issues that they might otherwise not be aware of. Transparency should not in itself add significantly to regulatory cost, nor does it necessarily require any particular change to the standards set, the point is simply to ensure that compliance, or the lack of it, is visible. However, the difficulty of relying on self-regulation, where the harm or costs to be avoided fall to third parties who are not a part of the commercial transaction to be regulated, was identified earlier. Transparency has some advantages in this respect by bringing those external costs to the attention of consumers, but it does not actually address the situation where the consumers have no direct interest in the external costs or harm.

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http://www.lemonde.fr/actualite-medias/article/2009/12/30/les-editeurs-de-presse-en-ligne-se-repartissent-20millions-d-euros-d-aides_1285932_3236.html 14 various press reports, http://www.mondaynote.com/2009/11/15/young-readers-already-hooked-on-subsidies/ 15 EU commission, http://www.regeringen.se/sb/d/14476 16 http://www.newspaperinnovation.com/index.php/category/legislation/page/3/ 17 http://www.ejc.net/media_landscape/article/norway/ 18 as described in Part K, Chapter 4

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Complaint Resolution 3.21 Complaint Resolution allows for those, whether consumers or third parties, who consider themselves to have been harmed by an action to seek some form of restitution or redress. There are various models of complaint resolution. Most start with the complainant putting their case to the company concerned. If the company fails to resolve the complaint to the satisfaction of the complainant then the matter is classed as a dispute and there could be an independent body that would seek to resolve the dispute. Currently the PCC acts as a quasi independent dispute resolution body in respect of complaints about press conduct and content, but only where the publisher is a funding member of PressBoF. There is no independent dispute resolution mechanism for those publications which chose not to be a part of the PCC. One widely used model for complaint resolution is the Ombudsman model. Ombudsmen can exist under statute or under voluntary agreement, and they will vary in how they operate and their powers. The Financial Services Ombudsman is a statutory body which has powers to resolve disputes between financial services companies and their customers in respect of a wide variety of products. The role of the ombudsman falls into two parts: first mediation to seek an agreed outcome and second, mediation having failed, determination of the dispute and imposition of a remedy. In the case of the FS Ombudsman the resolution is binding if the consumer accepts it but they can choose to go to court if they wish to. More generally Ombudsmen provide remedies which are fair and reasonable in all the circumstances, and are not necessarily bound by a strict interpretation of the law or precedent. In the public sector and in some private schemes their recommendations are not binding but met with nearly total compliance. This is secured by a variety of means whether by law, by contract, by publicity, by a regulator or by the moral force and the standing of the Ombudsman. There is no appeal against Ombudsman decisions, other than Judicial Review (where applicable) or where schemes (like the Pensions Ombudsman) have an appeal procedure in place. Incentives 3.25 Many types of incentives are available. The possibility of tax incentives has been considered earlier but tax is a very blunt instrument for changing behaviour. Generally rewards can come in terms of specific benefits or preferential treatment although it is difficult to consider this in the abstract. A number of specific suggestions have been made to the Inquiry in respect of the sorts of incentives that could be used, including: coverage in the ABC circulation figures; advertisers boycotting publications outside the regulatory regime; enhanced weight being given to public interest arguments in relation to unlawful behaviour; alternative dispute mechanisms to deal cheaply and quickly with libel and defamation cases (as well as other standards breaches) without going to court; and access to pre-publication, public interest advice that could be relied upon in retrospect. Some of these would be purely self-regulatory and would rely on the goodwill of parties outside the press (e.g. the advertising industry), some might require legislative change to deliver and others might require the involvement of the courts (which means changes to the law). All of the incentives that have been proposed to the Inquiry are considered fully in Part K, Chapter 4.

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Penalties 3.27 Penalties for failure to comply can include dissuasive penalties to attempt to prevent noncompliant behaviour occurring (or recurring) and remedial penalties to provide redress and make good the wrong, once the contravention has occurred. Generically, dissuasive penalties can include fines, removal of privileges/rights either as a punishment in its own right or to make it impossible for the perpetrator to repeat the offence (e.g. imprisonment, removal of a licence), additional checks and constraints on behaviour and public disclosure. Remedial penalties can include payment of compensation, and other acts of restitution such as an apology. In the press context the Inquiry has heard suggestions for a range of potential penalties in both the dissuasive and remedial categories: these include fines, a regime for requiring journalists to hold a press card, temporary prevention of publication, and publication of corrections with equal prominence to the offending article.

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CHAPTER 7 ConClusions And RECommEndATions foR fuTuRE REgulATion of THE PREss
1. Introduction
1.1 Earlier parts of this Report have set out in considerable detail the systems currently in place which seek to address press standards in an attempt to support high quality journalism while at the same time protecting the rights and interests of individuals. This has included examining the formal systems in place within individual titles, the informal culture and practices within titles (and across the press) and the industry agreed standards as embodied in the Editors’ Code of Practice which form the standard for the Press Complaints Commission (PCC) when giving advice or handling complaints. Throughout, I have drawn conclusions on the adequacy and effectiveness of those systems. It is important to make the point, yet again, that I recognise that most of the press, most of the time, do meet the high standards that the UK public is entitled to expect. I have explored good practice in the Report,1 looking both at the generic importance of a free press and at examples of good practice across the industry. However, when looking at whether the standards regime in place is adequate, it is important that the analysis takes account not only of what happens most of the time but also, and critically, what the regime allows to happen some of the time. And there can be no doubt that, on occasion, there has been a significant failure of standards within and across parts of the national press. To some extent, these significant failures have been conceded by everyone: I have concluded, however, that they are more widespread than has been universally acknowledged. That these failures have included breach of civil rights on a substantial scale is made evident by the civil claims that have already been settled by the News of the World (NoTW) in respect of phone hacking. The reports of the Information Commissioner in 2006 provided prima facie evidence of criminal breach of data protection legislation on behalf of journalists across a number of areas of the national press. And, of course, the police are still investigating a substantial number of suspected criminal offences, not just at the NoTW, but elsewhere in News International (NI) and in some other titles.2 Arrests have been made covering unlawful interception of communications and payments to public officials. Some suspects have been charged, in particular in relation to conspiracy to intercept communications without lawful authority. I can obviously make no comment on these cases and do not pre judge any of them. It is, however, appropriate to observe that the fact that such a significant police investigation has resulted in so many arrests and charges so far, at least gives rise to a legitimate cause for concern. The criticisms that can be levied against the press on the basis of the evidence that this Inquiry has heard are set out elsewhere in this Report.3 My conclusions on the effectiveness of the PCC as an industry self-regulator have been dealt with earlier.4 It is abundantly clear from this that current systems of both internal governance in some parts of the press, and industry self-regulation of the press, have not worked and are not working.

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Part F, Chapter 2 journalists from News International, Trinity Mirror and Express Group: http://www.levesoninquiry.org.uk/wpcontent/uploads/2012/07/Third-Witness-Statement-of-DAC-Sue-Akers.pdf 3 Part F, Chapter 6 4 Part J, Chapter 4
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Can the PCC continue to act as regulator?
1.5 In Chapter 1 above, I set out the criteria that I consider need to be met for a regulatory regime to be considered effective. The system operated by the PCC falls short of these criteria on a number of key points. First, it has lost credibility with the public, with politicians and with the press itself. This is not just a view that I have reached, but is shared by Lord Black in his own submission to this Inquiry5 on what the future regulatory regime should look like. On top of that, the departure of Northern and Shell from the system has shown that it is not able to deliver complete coverage, even of the major national newspaper groups. The PCC lacks the independence that is critical to building public confidence in a regulator. It has been dominated by the industry, both through the influence of the Press Board of Finance (PressBoF), particularly in relation to appointing the Chair and the press members of the Commission, and through the presence of serving editors in both the Code Committee and on the Commission itself. The Editors’ Code, whilst widely considered both within and outside the industry as being a good code, provides a set of general requirements. These often contain a measure of uncertainty over how and when they might apply. The development of the Code over the years has achieved a great deal. It can, however, be improved to provide a constructive ethical and legal framework within which journalists should work. In any event, compliance with, and enforcement of, the Code has been inadequate and intermittent. The structures and practices of the PCC have constrained it to acting as a mediator in respect of complaints, rather than having any enforcement role that is consistent and effective. The failure to identify any code breaches where a mediated settlement could be reached, or to provide meaningful statistics in relation to complaints brought and how they were resolved, means that there is no authoritative picture of just how often breaches have occurred and where they have occurred. The manifest failures of the PCC to take any steps to address the reports from the Information Commissioner and the discredited investigations and conclusions by the PCC into phone hacking (since abandoned), demonstrate that the PCC, despite calling itself a regulator and referring to self-regulation of the industry, has not acted as regulator of standards as opposed to a reactive case-handler. The remedies available to the PCC have proved an inadequate deterrent to breach. Whilst the industry have shouldered the full cost of operation of the PCC, the PCC has not been provided with the funding that it would have needed to act as a credible regulator. It is clear, therefore, that continuation of the status quo is not a credible option, and no one has suggested that it is.

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p13, para 1, http://www.levesoninquiry.org.uk/wp-content/uploads/2012/07/Submission-by-Lord-Black-ofBrentwood1.pdf

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2. Options put forward
The industry proposal
2.1 The inability of the PCC to fulfil the required role has been recognised and accepted by the industry, which has put forward its own proposal for the future in the form of a submission from Lord Black, as the Chairman of PressBoF. That proposal is described6 and analysed7 earlier. As I have already said, that proposal does represent a significant improvement on the PCC as currently constituted and I recognise, and am grateful for, the efforts that have gone into constructing what is intended to be a new, more independent and more effective model. However, unfortunately, although it would represent an improvement on the status quo, and aspects of the framework could be built on, I conclude that the extent of industry control within the proposed system is a fundamental flaw. First, the proposal does not have the clear support of any larger proportion of the industry than the current system. If the PCC is inadequate, at least in part, because a major national newspaper group sits outside it, then Lord Black’s proposal must also be inadequate. Northern and Shell has not said explicitly that it would not join the organisation if it was to be established, but its evidence to the Inquiry is sufficiently negative to give a strong steer that that is the case. Certainly, there must be a substantial doubt as to the ability of this proposal to command full industry support and cooperation, and there is no sufficient mechanism for the critical goal of full participation by all. Second, the system as proposed provides no long term stability. This has two features. The first is that a five year contract would bind members into the club for that period, but there is no guarantee that the system would continue to operate beyond the first five year term. The second feature is that it provides no assurance that the level at which standards or safeguards would be set would meet the level rightly expected by the public. Or that, once set, they would remain at that level. Thus, the proposal does not provide sufficient long term stability, durability or guarantee. That is not to say that contracts between the regulator and the regulated entity have no role to play in a future model; it is simply the case that they do not, on their own, provide sufficient assurance of long term effectiveness. Third, and of critical significance, the model presented by Lord Black fails to offer genuine independence from the industry. The industry, primarily through the Industry Funding Body (IFB), would have substantial influence over the appointment of the Chair of the Trust, as well as having ‘responsibility’ for the Code and having to approve any changes in the regulations. The continuation of the Code Committee with a majority of serving editors, acting in more than an advisory role, does not allow for independent setting of standards. A new system must have an independent and effective enforcement and compliance mechanism. As I have already said, I endorse the approach to internal company governance proposed by Lord Black. In particular, I support the proposal that complaints should be dealt with in the first instance by publishers and the requirements for an annual return on compliance to the regulator, and a named senior individual within each title with responsibility for compliance and standards. These are real innovations and are welcome. However, the proposal still has serving editors on the body making decisions on complaints, and this does not provide the required degree of independence of enforcement. The proposal for a standards and compliance arm, with both its ongoing monitoring role and its ability to carry out investigations, is welcome, although in practice, as currently set out by Lord Black, it could be so drawn out and so hedged about with appeals that I doubt it could ever be used effectively.

2.2

2.3

2.4

2.5

K
6 7

Part K, Chapter 2 Part K, Chapter 3

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Chapter 7 | Conclusions and recommendations for future regulation of the press

2.6

A new system must have the ability to offer meaningful remedies to those who have been harmed. This proposal does not offer any significant improvement on the current PCC approach in this regard. It must also be able to apply effective sanctions to those who continue to breach standards: although real movement has been made in that direction, through the proposals on investigations and the power to fine, there are serious concerns about it resulting from procedural complexity that is greater and more extensive (thereby causing significant delay) than is necessary even when having full regard to the vital requirements of fairness. The improved transparency is to be welcomed, but it is not sufficient. Finally, an effective regulatory system must be adequately financed and have sufficient independence from its funding body to operate independently. It is impossible for me to take a view on what constitutes adequate funding given the early stage of development of the proposal. What is clear, however, is that the IFB has sole discretion to decide on the funding and this cannot give the regulator sufficient independence to carry out its role properly.

2.7

Other proposals
2.8 Many proposals, with various degrees of detail, were put forward by interested parties and I would like to express my gratitude to all of them for the efforts that they made. These proposals are examined in detail elsewhere.8 It is fair to say that, whilst there are many excellent and helpful ideas contained within those proposals (a number of which I am happy to adopt), there are none that, on their own, sufficiently meet all the criteria that I set down. If I am not to adopt a proposal that has been put in front of the Inquiry I must instead construct one myself. In section 4 below, I look at what a satisfactory system must contain, but first I address the question of coverage.

2.9

3. A new system must include everyone
3.1 A new system must be effective, and one of the key criteria of effectiveness is that it should include all major publishers of news (if not all publishers of newspapers and magazines). This has been an almost universal view from the witnesses who have given evidence to the Inquiry in relation to future regulation; they have been clear that any new system should cover all news publishers, and that compliance with it should not be a matter of choice. There has been a striking level of agreement between commentators, the industry and politicians as to the desirability of all newspapers being covered by a regulatory regime, although not everyone has explained how they would deliver such comprehensive coverage. The Prime Minister, the Rt Hon David Cameron MP, said:9 “What we actually have to deliver is that it